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Solid US growth

October 30, 2014

The US economy has grown further in the past few months, beating analysts' expectations. Third-quarter figures showed expansion was based on a smaller trade deficit and a surge in defense spending.

https://p.dw.com/p/1DeZq
Ford facility in Michigan
Image: Getty Images

In its first estimate for the third quarter, the US Commerce Department said Thursday that the economy expanded by an annualized 3.5 percent.

The rise followed a 4.6-percent jump in the second quarter, with the US economy delivering its strongest consecutive quarters since the second half of 2003.

The Commerce Department noted that GDP expansion between July and September was largely driven by a narrower trade deficit, which reflected a plunge in imports, which fell at their fastest pace since the end of 2012.

Mixed indicators

"The report was broadly constructive, with the gains broadly based on pointing to positive underlying momentum in the US economy," TD Securities economist Millan Mulraine said in a statement.

"However, with some indications of weakness emerging in housing and consumer spending, we expect the pace of growth to slip."

The survey revealed that household spending as the key driver of the world's largest economy cooled in the third quarter, rising by only 1.8 percent after logging 2.5-percent growth in the previous three months.

hg/ng (AFP, Reuters, dpa)