US economy grows faster than expected in Q3
By Frank Prenesti
Date: Tuesday 23 Dec 2025
(Sharecast News) - The US economy grew faster than expected in the third quarter of the year, driven by higher consumer and government spending along with exports.
GDP rose at annualised rate of 4.3%, the US Bureau of Economic Analysis reported on Tuesday, up from 3.8% in April-June, driven by higher consumer and government spending along with exports.
The preliminary reading beat forecasts of a slowing to 3.3%. A fall in investment partly offset the rise, the BEA said. Imports, which are a subtraction in the calculation of GDP, decreased, it added.
Compared to the second quarter, the acceleration in real GDP in the third quarter reflected a smaller decrease in investment, an acceleration in consumer spending, and upturns in exports and government spending. Imports decreased less in the third quarter.
Real final sales to private domestic purchasers, the sum of consumer spending and gross private fixed investment, increased 3%, compared with a rise 2.9% in the second quarter.
Within services, the leading contributors were health care and other services. Within goods, the leading contributors were recreational goods and vehicles as well as other nondurable goods., the BEA said.
The price index for gross domestic purchases increased 3.4% compared with a 2% rise in the second quarter. The personal consumption expenditures price index was up 2.8% against 2.1% in the prior three months. Excluding volatile food and energy prices, the PCE price index increased 2.9%, compared with an increase of 2.6% last quarter.
James Knightley, chief international economist at ING, said he expected a slowdown in the final quarter "as the effects of the government shutdown filter through and the temporary boost from trade fades".
"Beneath the strong headline, however, the data points to a clear K-shaped economy, with growth concentrated among higher-income households and tech-led investment, while broader consumer confidence remains under pressure," he said.
Reporting by Frank Prenesti for Sharecast.com
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