After surging at an inflation-adjusted 5.6% annual rate during the first three months of this year and slowing to a 2.6% annual in the second quarter, the U.S. economy again lost momentum from July through September, decreasing to an annual growth rate of just 1.6%, the U.S. Commerce Department reported on Oct. 27. Third-quarter growth was a half percentage point below the 2.1% rate economists generally expected. Lower private-sector inventories and a slower U.S. housing market contributed to the third quarter's GDP deceleration.
On the other hand, consumer spending on manufactured goods (both durable and non-durable) and services increased 3.1% during the third quarter, up from 2.6% in the second quarter. Spending on business equipment and software increased 6.4% in the third quarter after falling 1.4% in the second quarter.