The US economy accelerated in the three months to September, growing at an annual pace of 4.3%, up from 3.8% in the previous quarter. The figure exceeded market expectations and represented the fastest growth in the past two years.
The stronger-than-expected performance was largely fueled by rising consumer spending and a recovery in exports. Household spending increased at an annual rate of 3.5%, compared with 2.5% in the prior quarter, as consumers spent more on services such as healthcare despite a cooling labor market.
Exports rebounded sharply, rising by 7.4% after a significant decline in the previous period. Imports, which subtract from overall growth, continued to fall, reflecting the impact of new tariffs on shipments entering the US announced earlier this year.
Government spending also picked up, supported by higher defense outlays. These gains helped offset slower business investment, including in intellectual property, and a housing sector still weighed down by elevated interest rates, which continue to affect affordability and supply.
Commenting on the data, Bank of America senior economist Aditya Bhave said the US economy has shown remarkable resilience.
“This is an economy that has defied pessimistic expectations since the beginning of 2022,” Bhave said in an interview with the BBC. “I don’t see why that wouldn’t continue going forward.”
The data, released with a delay due to a temporary US government shutdown, highlighted that despite policy shifts in trade and immigration, persistent inflation and cuts in public spending, the underlying momentum of the economy has remained solid.
