US Q3 growth revised downward

November 23rd, 2011 - 11:41 am ICT by IANS  

Washington, Nov 23 (IANS/EFE) US gross domestic product grew at an annual rate of 2 percent in the third quarter, the Commerce Department said Tuesday, revising its initial estimate that the economy expanded at a 2.5 percent rate in the July-September period.

Consumer spending, which in the US represents more than two-thirds of GDP, grew at an annual rate of 2.3 percent in the third quarter, down from 2.4 percent in the first estimate.

The estimate Tuesday is the second of the three estimates that the Commerce Department makes on quarterly economic activity and business investment, which was originally estimated to have a 16.3 percent annual growth and has now been downgraded to a growth rate of 14.8 percent.

The consumer price index measure of inflation remained basically unchanged in the figures reviewed.

But third-quarter advances in retail sales, manufacturing and housing, combined with a reduction in inventories, point to a greater probability that the world’s biggest economy will bounce back to a more vigorous growth rate.

Among the adverse factors still weighing heavily on the US is the fact that 2 1/2 years after the deepest, most prolonged recession in 80 years, unemployment stands at 9 percent and incomes are stagnant, both impediments to consumer spending.

–IANS/EFE
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