U.S. real GDP sees 4.9% increase in quarter; momentum which will likely fade
Real gross domestic product in the United States increased at an annual rate of 4.9 percent in the third quarter, according to the “advance” estimate released by the Bureau of Economic Analysis.
The noteworthy increase in real GDP came from an increase in consumer spending, such as in housing, utilities and health care, as well as from private-inventory investment, and increased federal, state and local government spending and exports.
Meanwhile, real disposable personal income decreased 1 percent, compared with a 3.5 percent increase during the second quarter. Personal saving was $776.9 billion in the third quarter, down from $1.04 trillion in the second quarter.
The strong consumption growth in the third quarter “was fueled by an unsustainable drop in the personal saving rate to 3.8 percent from 5.2 percent,” said Michael Pearce, lead U.S. economist at Oxford Economics.
“There were also signs that monetary tightening is weighing on investment