US economy up solidly in third quarter, slowing now

The US economy expanded briskly in the third quarter on a wave of consumer spending, the Commerce Department confirmed today, …

The US economy expanded briskly in the third quarter on a wave of consumer spending, the Commerce Department confirmed today, but growth is forecast to slow sharply in the closing months of the year.

US gross domestic product, the measure of total output within US borders, rose at an annual rate of 4 per cent in the July-September three-month period - the same as estimated a month ago and more than triple the 1.3 per cent rate posted in the second quarter.

The department's third and final assessment of third-quarter performance issued on Friday contained only minor changes from the figures it published a month ago.

The GDP figure was in line with Wall Street economists' expectations and was likely to have little or no impact on financial markets.

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First estimates for fourth-quarter GDP will not be issued until January, but private-sector forecasters see the pace of expansion trailing off to less than half the rate seen in the third quarter.

The widely watched Blue Chip economic forecasters group estimated earlier this month that fourth-quarter GDP will brake to a weak 1.4 percent annual rate before beginning to add power and grow more rapidly in 2003.