US economy grew 3.4% in third quarter

The U.S. economy grew at a 3.4% annualized rate in the third quarter of 2026, according to the Commerce Department’s advance estimate, accelerating from 2.2% in the previous quarter and exceeding economists’ forecasts. The preliminary estimate covers July through September and may be revised in two further releases in the coming weeks. The Bureau of Economic Analysis said increases in investment, consumer spending and government spending contributed to growth, partly offset by a decline in exports. Imports also rose more than in the second quarter, according to the estimate. Consumer spending increased at a 3.8% annualized pace in both the second and third quarters, accounting for more than two-thirds of U.S. economic activity. The third-quarter figure came despite higher energy costs and persistent inflation. The BEA reported that prices measured by the personal consumption expenditures index rose 3.6% in September from a year earlier, above the Federal Reserve’s 2% target. The Federal Reserve held its benchmark interest rate in a range of 3.75% to 4% on Wednesday, while acknowledging that inflation remained elevated. Fed Chair Kevin Warsh said economic activity was expanding...