US GDP: America beats forecasts with 3% annualised growth – business live

Rolling coverage of a crucial growth report on the US economy, after strong results from America’s tech giants cheer the markets


The US dollar is strengthening, as Wall Street traders calculate that this solid growth raises the chances of an interest rate rise in December:

Dollar’s good week just got better with 3Q GDP +3%

Economists are impressed by America’s economic performance over the last quarter, especially given the disruption caused by the hurricane season.

For example, here’s Mohamed El-Erian, chief economic advisor at financial services giant Allianz:

Good US #GDP print for the third quarter–3% annualized growth, compared to 2.7% consensus expectations,& follows 3.1% for the prior quarter

Q3 GDP grew at a healthy 3.0% (above consensus forecast of 2.6%), following 3.1% in Q2. The economy keeps motoring along at a healthy rate.

The good news: The economy keeps on keeping on, shrugging off political uncertainty, hurricanes, etc.

The bad: The more persistent part of growth—Final sales to private domestic purchasers—grew at only 2.2%. And advance numbers often revised.

Growth over the last four quarters was 2.3%. PDFP was 2.2% in Q4. We are still a ~2% growth economy. But a 2%+a little > 2%-a little.

For those that don’t know, PDFP = consumption + fixed investment. Does not have inventories, NX, govt–all volatile.

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