U.S. Q3 economic growth revised down marginally, growth to reach 2.5 pct in Q4

The U.S. Bureau of Economic Analysis’ third estimate of the nation’s third quarter economic growth saw a 0.1 percentage point downward revision, and the economy is now recorded to have expanded 3.2 percent sequentially, as compared with the second estimate of 3.3 percent.

The revision in the third estimate came mainly from personal consumption and in particular the services component. But some of the downward revision in services consumption was countered by spending on goods that was pushed higher to 4.5 percent. Meanwhile, fixed investment remained the same at 2.4 percent, government consumption was upwardly revised a bit to 0.7 percent and the contributions from inventories and net trade remained widely unchanged.

Overall, the third estimate of the third quarter is in line with the economy expanding at a strong rate. Growth in the first quarter decelerated considerably, but it recovered strongly in the subsequent quarter implying likely temporary factors drove the economic weakness at the beginning of 2017, noted Barclays in a research report.

“We expect growth to slow a touch in Q4 to 2.5 percent q/q saar, but to nevertheless be consistent with a robust economy and annual growth of 2.3 percent for 2017 as a whole”, added Barclays.

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