Strong consumer and government spending powered economic growth in the third quarter, although a warning sign about the outlook emerged in the form of weak business investment.
Gross domestic product—the value of all goods and services produced in the U.S.—grew at a seasonally and inflation-adjusted annual rate of 3.5% from July through September, the Commerce Department said Friday. That was slightly higher than the 3.4% reading economists surveyed by The Wall Street Journal had expected and followed strong growth in the second quarter.
Consumer spending, which accounts for more than two-thirds of total economic output, rose at a 4.0% annual rate in the third quarter, the strongest rate of growth in nearly four years. A low unemployment rate, steady job and wage growth and the late-2017 tax overhaul encouraged spending by consumers.
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