The US economy rose by 3.2% during the third quarter, according to the upwards revised data by the Ministry of Commerce. On first reading the growth was evaluated to 2.9%, but the economists and analysts were sure in upward revision and projected growth of 3.0% on second reading. The US economy is accelerating after the growth in second quarter was 1.4%.
The most recent data show that there are higher consumer spending, but at the expense of business investment are weaker than originally thought. The key measure of corporate profits rose for third consecutive quarter. The profits after taxes without stock and capital consumption adjustments, increased by 3.5% from the previous quarter to a seasonally adjusted annual rate of 1.694 trillion USD.
Compared to the third quarter last year, profit after tax increased by 5.2%, which is the largest annual increase since 2012.
Thus, the gross domestic product (GDP) grew by 1.6% in Q3 2016, showing maximum growth for the past two years. The US GDP accelerated after the growth of 1.3% in previous quarter. The good results are mainly due to increased consumption of households and the state, but also thanks to the 10% increase in exports.
Consumer spending, which generate about 70% of US GDP increased by 2.8% yoy, which is above the initial estimate of 2.1%, but signaled a slowdown in the second quarter, the increase amounted to 4.3%. The business expenses with the exception of real estate, grow a modest 0.1% compared to an initial estimate of 1.2% growth.
The net exports and stock help GDP growth in the third quarter and delayed investment in housing outweigh the meter. The increase in the cost of the federal government were eclipsed by the decline in the cost of state and local authorities.
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