The US economy grew slightly less robustly in the third quarter than previously thought and prices picked up, although the pace of expansion remained the strongest since the beginning of 2004.
Gross domestic product, or total output within US borders, expanded at a 4.1 per cent annual rate in the July-September quarter, the US commerce department said in its final estimate of growth for the period.
The department had pegged growth at 4.3 per cent a month ago, partly because new-car sales were slower than estimated earlier. Wall Street analysts had forecast no revision in the third-quarter growth rate.
Consumer spending that fuels about two-thirds of national economic activity expanded at a 4.1 per cent annual rate instead of 4.2 per cent estimated a month ago, though that still was well ahead of the second quarter's 3.4 per cent rate. Investment in new-home building increased at a 7.3 per cent annual rate instead of 8.4 per cent estimated a month ago, below the second quarter's 10.8 per cent rate of growth.
Corporate profits suffered during the third quarter, falling 4.3 per cent after taxes in part because insurance companies were hit by big payments to policyholders after hurricanes Katrina and Rita. Profits in the second quarter rose at a 5.3 per cent rate.
Price pressures picked up slightly from the initial estimate a month ago. The price index for consumer spending rose at a 3.7 per cent rate in the third quarter instead of 3.6 per cent, ahead of the second quarter's 3.3 per cent.