Us Economy Grew Stronger 2.7% in Third Quarter

The US economy grew at a 2.7 percent pace in the third quarter, faster than previously estimated, the Commerce Department said Thursday in a report that nevertheless pointed to a weaker fourth quarter.

Markdowns are advertised at a discount clothing store in New York City. The US economy grew at a 2.7 percent pace in the third quarter, faster than previously estimated, the Commerce Department said.

Gross domestic product growth was revised upward from the prior estimate of 2.0 percent, reflecting in part increases in federal government spending and private inventory investment, the department said.

Growth in the July-September quarter was the strongest of the year, and followed a meager 1.3 percent pace in the second quarter.

Still, growth remained modest as the world's largest economy headed into the fourth quarter.

"This morning's GDP report is one of those rare instances when growth is a lot stronger than in the advance report but the domestic economy turns out to be a lot weaker," said Chris Low at FTN Financial.

Growth in consumer spending, which accounts for 70 percent of output, was revised down to 1.4 percent, just slightly above the second-quarter pace.

Inflation slowed...