US GDP grows 3.4% in the third quarter; consumer spending rises 3.8%

The U.S. economy maintained robust growth during the summer, with businesses making significant investments in artificial intelligence-related projects and consumers continuing to increase spending despite high prices. The U.S. Bureau of Economic Analysis stated on Thursday that, after adjusting for inflation, U.S. GDP grew at an annual rate of 3.4% in the third quarter, higher than the 2.2% in the spring and marking the fastest growth in a year. Consumer spending, which accounts for more than two-thirds of total U.S. economic output, grew by 3.8%. The strong consumption and economic growth data contrast with the negative assessments of the economy by many voters. With the midterm elections approaching next week, polls consistently show that Americans are dissatisfied with the high cost of living and believe that President Trump and congressional Republicans have failed to deliver on promises to improve affordability, holding them responsible. However, preliminary data released on Thursday show that, despite Americans’ dissatisfaction with inflation, they have not yet started to cut back on spending. This has helped the economy maintain momentum during turbulent times, but could also exacerbate inflation, as strong consumer demand makes it easier for businesses to pass on price increases to consumers.