Source: Reuters North American News Service Additional links from Reuters North American News Service
WASHINGTON (Reuters) - The U.S. economy grew at a surprisingly brisk clip in the third quarter, the government said Wednesday in one of a series of reports that implied a resilient expansion despite a battered housing sector.
A pickup in consumer spending and strong exports powered economic growth ahead at its fastest rate during the third quarter since the beginning of 2006.
Growth in gross domestic product, which measures total production within U.S. borders, unexpectedly edged higher to a 3.9 percent annual rate, up from 3.8 percent in the second quarter for the strongest quarterly growth since 4.8 percent in the first quarter of 2006, the Commerce Department reported.
The robust GDP figure raised questions among some analysts whether Federal Reserve policy-makers will need to lower interest rates at the conclusion of a two-day policy session later on Wednesday.
"The Fed has a strong economy, high productivity, low wage pressures and low inflation," said Pierre Ellis, senior economist at Decision Economics in New York. "These data do not argue in favor of a rate cut."
Economists surveyed by Reuters had forecast that third-quarter growth would slow to 3 percent partly in expectation that dispirited consumers hurt by falling house prices would trim their spending.
Surveys have shown that consumer confidence has suffered as a subprime mortgage crisis lingers on.