US GDP Expands 4.9% In Q3: Strong Household Consumption Beats Expectations

The U.S. economy outperformed expectations by recording a robust 4.9% growth rate in the third quarter of 2023, as revealed by advance estimates released on Thursday by the Bureau of Economic Analysis. This exceeded the economist projected growth rate of 4.3%.

When excluding the post-pandemic period, the rate of economic growth in the last quarter was some of the strongest in the last decade.

US Q3 GDP: Key Highlights

• The U.S. gross domestic product (GDP) surged by 4.9% at a quarter-on-quarter annualized rate in the third quarter of 2023, showing a significant acceleration from the 2.1% growth observed in the second quarter. This figure notably exceeded economists’ expectations of 4.3%.
  
• This growth rate is the highest since the second quarter of 2014 and well above the pre-pandemic decade’s average of 2.35%.
  
• The primary driver of this growth was consumer spending, which exhibited a remarkable 4% growth rate during the quarter, a substantial improvement from the 0.8% growth seen in the second quarter.
  
• The Personal Consumption Expenditures (PCE) price index increased by 2.9%, up from the previous 2.5%. When excluding food and energy prices, the PCE price index also rose, registering a 2.4% increase, but down from the prior 3.5%.

Immediately after the release, the U.S. dollar (DXY) index experienced a significant 0.2% upswing.

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