US economic growth accelerated in Q3 2016

The US economic growth accelerated in Q3 2016 to 2.9% on annual rate, which is the sharpest rise in two years. The data gives some relief for the presentation of the economy in the short term, but do not change the trajectory of the long-term weak expansion. Acceleration is significant in comparison with the second quarter, when the annual growth rate was 1.4%. The latest results also surpassed expectations of economists, who had forecast an increase of 2.5%.

The accelerated growth was largely due to the increased exports and higher reserves. On other hand the growth of consumer spending slows. Since the end of the recession in mid-2009, the US economy grew at an annual rate of around 2.0%.

The personal consumption expenditure grew by 2.1%, against 4.3% in the previous period. The expenditure on durable goods such as cars grow by over 9% a second consecutive quarter.

The exports increased by 10%, which is the best performance in nearly three years, while the imports increased by 2.3%. The overall trade lost 0.83% of economic growth.

The change in stock in the private sector, which override the expansion over the past five quarters during the period from July to September contributing 0.61%. The increase in inventories signals that the companies are more confident as regards demand in the future.

The costs for housing and home improvements decreased second consecutive quarter. The government spending grew by 0.5%, as higher costs offset the reduced federal spending at the state and local level.

Recent data suggest that the growth this year will be above last year by 2.6%, which was the best during the current expansion. The US economy failed to register an annual growth of 3% in any year since 2005, and many economists expect the rate to remain such a rarity.

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