The U.S. economy grew at an even stronger pace then previously indicated in the third quarter, the product of a better than expected business investment and stronger government spending, the Commerce Department reported Wednesday.
Gross domestic product, a measure of all goods and services produced during the three-month period, accelerated at a 5.2% annualized pace, the department’s second estimate showed. The acceleration topped the initial 4.9% reading and was better than the 5% forecast from economists polled by Dow Jones.
Primarily, the upward revision came from increases in nonresidential fixed investment, which includes structures equipment and intellectual property. The category showed an increase of 1.3%, which still marked a sharp downward shift from previous quarters.
Government spending also helped boost the Q3 estimate, rising 5.5% for the July-through-September period.
However, consumer spending saw a downward revision, now rising just 3.6%, compared to 4% in the initial estimate.
There was some mixed news on the inflation front. The personal consumption expenditures price index, a gauge the Federal Reserve follows closely, increased 2.8% for the period, a 0.1 percentage point downward revision. However, the chain-weighted price index increased 3.6%, a 0.1 percentage point upward move.
Corporate profits accelerated 4.3% during the period, up sharply from the 0.8% gain in the second quarter.