US economic growth continues to be robust.
The government’s first estimate for the the period from July to September was that GDP expanded at an annual pace of 3.5 percent – better than the 3.0 percent that economists had predicted, but down from the 4.6 percent in the second quarter.
Among the factors were a smaller trade deficit as imports slumped – particularly oil – and a surge in defence spending, which rose at its fastest pace since the second quarter of 2009.
Business investment, housing and consumer spending were not as strong as in the previous three months, but all held up with job gains helping consumer confidence.
Consumer spending, which accounts for more than two-thirds of US economic activity, decelerated to a 1.8 percent pace from the second-quarter’s 2.5 percent.
The numbers were released one day after the US central bank, the Federal Reserve, ended its programme of buying bonds each month to pump money into the US economy.
Fed officials said they were able to do that because there is sufficient underlying strength in the broader economy.
The moderate pace of consumer spending helped keep inflation weak, which is not what the Fed’s policymakers want as they have an annual inflation target of around two percent .
However, they did say the likelihood of inflation undershooting that target had diminished since earlier this year.