WASHINGTON - The US economy expanded at a faster pace in the third quarter, more than previously expected, according to the Commerce Department's final estimate released Thursday.
US gross domestic product (GDP), the value of all goods and services, grew at a 3.1 percent annual rate, stronger than the previously estimated 2.7 percent rate. It was also more than double the 1.3 percent expansion pace in the second quarter, marking expansion for the 13th quarter in a row.
The acceleration in economic growth mainly reflected upturns in private inventory investment and government spending as well as a downturn in imports, noted the Commerce Department. Consumer spending, the main engine for growth, grew 1.6 percent in the third quarter, higher than the 1.4 percent rate in the second estimate released last month and the 1.5 percent in the previous quarter.
Real exports of goods and services increased 1.9 percent, lower than the 5.3 percent in the second quarter. Real imports of goods and services decreased 0.6 percent, in contrast to an increase of 0.1 percent in the second estimate and 2.8 percent in the prior quarter.
Real federal government consumption expenditures and gross investment increased 9.5 percent in the third quarter, in sharp contrast to a decrease of 0.2 percent in the second.
The change in real private inventories added 0.73 percentage point to the third-quarter change in real GDP, after subtracting 0.46 percentage point from the second quarter change.
However, with uncertainty of the looming "fiscal cliff" weighing on businesses and consumers, analysts project the economic growth would be held back and fall below 2 percent in the fourth quarter.
The Federal Reserve has downgraded its forecast for the economy. It expected growth of 1.7 percent to 1.8 percent for the year, slightly lower than its previous estimate in September.