The US economy expanded at an annualised rate of 8.2 per cent in the third quarter - its fastest for 20 years - with greater investment and inventory-building by companies leading to a steep upward revision in official figures.

Government statisticians had estimated growth in the quarter at an annualised 7.2 per cent.

The revised GDP figures, the strongest since the first quarter of 1984, coincided with more evidence of improving consumer sentiment.

The Conference Board's confidence index jumped 10 points to 91.7 in November, its highest level for over a year.

Economists expect consumer spending to slow in the year's final three months but the confidence figure suggests the fall may be less abrupt than forecast.

The Conference Board survey pointed to growing optimism over the labour market, with a drop in the number saying jobs were hard to get and a rise in those saying jobs were now abundant.

Personal consumption, the biggest single component of demand, rose by 6.4 per cent annualised, slightly lower than the initial estimate of 6.6 per cent.

But it was a turnaround in business inventories that was mainly responsible for the upward revision of growth. Inventories fell by just $14.1 billion (€11.9 billion) on the quarter compared to $35.8 billion before the revision.

Recent inventory figures suggest this improvement is continuing into the final quarter of the year, with companies accumulating stocks in October for the first time in five months.

The pace of growth is expected to moderate significantly in the final three months, with economists forecasting annualised growth of around 3.5 per cent.

But the figures may increase optimism that companies are becoming more willing to take risks by adding to their stocks, investing in equipment and hiring new staff.