US economy grows at brisk 3.4% pace in third quarter on strong consumer spending and AI investment
WASHINGTON (AP) — The U.S. economy grew at a healthy 3.4% 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% growth registered from April through June, the Commerce Department said Thursday. Consumer spending rose at a brisk 3.8% 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% in the third quarter, according to a survey of forecasters by the data firm FactSet.
U.S. growth has been lifted by an AI investment boom. Business investment, excluding housing, was up 12.7% in the third quarter. Investment in information processing equipment surged 37.4%, in software 9.6% and in research and development 7.5%.
However, housing investment, hurt by high mortgage rates, dropped 3.3% 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.
© Copyright The Associated Press. All rights reserved. The information contained in this news report may not be published, broadcast or otherwise distributed without the prior written authority of The Associated Press.
