The US economy grew at a healthy 3.4 percent annual pace from July through September, accelerating from the second quarter on strong consumer spending and investment in artificial intelligence.

The expansion in third-quarter gross domestic product – the nation’s output of goods and services – was faster than the 2.2 percent growth registered from April through June, the US Commerce Department said on Thursday.

Consumer spending rose at a brisk 3.8 percent clip in the third quarter, and business investment was up sharply, reflecting the AI boom.

The American economy – by far, the world’s biggest – has proven resilient in the face of higher energy prices caused by the fighting with Iran.

Economists had expected GDP to grow 3 percent in the third quarter, according to a survey of forecasters by the data firm FactSet.

US growth has been lifted by an AI investment boom. Business investment, excluding housing, was up 12.7 percent in the third quarter. Investment in information processing equipment surged 37.4 percent, in software 9.6 percent and in research and development 7.5 percent.

However, housing investment, hurt by high mortgage rates, dropped 3.3 percent and has now fallen six of the last seven quarters.

Thursday’s report was the first of three Commerce Department estimates of third-quarter GDP growth. (AP)



Edited by Edmond Fong