The US economy grew at its fastest rate in four years during the third quarter, the government confirmed today.
The Commerce Department said GDP expanded at a 4.9 per cent annual rate in the third quarter, the same as it estimated a month ago and the strongest since the third quarter of 2003.
But a surge in new claims for jobless benefits showed the labour market is softening. A separate report from the Labor Department showed claims rose by 12,000 last week to 346,000.
The four-week moving average of claims - seen as a more reliable barometer of labour market conditions - hit its highest in more than two years.
Faster exports and increased inventory-building accounted for the pickup in third-quarter growth from the second quarter's 3.8 per cent pace, but many economists say the drag from a weak housing sector and credit market turmoil will slow fourth-quarter expansion to 1 per cent or less.