- Lawrence Yun, NAR chief economist
The US economy grew at the strongest pace in more than a decade during the third quarter, bolstered by robust consumer spending and business investment. Gross domestic product, the broadest measure of goods and services produced across the economy, rose at a seasonally adjusted annual rate of 5.0% in the July-September period, the Commerce Department said. That was up from the second quarter's growth rate of 4.6% and the strongest pace since the third quarter of 2003. The agency last month had projected third-quarter GDP growth at 3.9%. While the rate of growth likely slowed in the final quarter, strengthening labour market and falling gasoline prices should provide the world's biggest economy with a boost in 2015 and keep the US central bank on path to start hiking interest rates by the middle of next year. Fed policy makers estimate GDP growth of 2.3% to 2.4% in 2014, and an acceleration next year to growth of 2.6% to 3%.
A separate reading on US durable goods orders unexpectedly slumped in November, largely owing to a weak demand for military and defence goods. The Commerce Department said that orders for long-lasting goods declined 0.7% last month, the third drop in the past four months. Much of the decrease was attributed to a sharp 8.1% fall in demand for defence-related goods. Excluding volatile transportation equipment, bookings slid 0.4%.
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