US Economy Grows Thanks to Consumer Spending

By CP News Briefs, Friday, October 28, 2011

The U.S. Commerce Department released figures Thursday that show the U.S. economy grew at an annualized rate of 2.5 percent in the third quarter of this year, between July and September. It had grown at 1.3 percent in the three months prior to that.

The growth was double the percentage of the previous quarter, and is mainly due to consumer spending in durable goods such as fridges and business investments in construction, equipment and software. Orders for such durable goods rose 1.7 percent in September, according to figures.

Also, a reported 103,000 jobs were added in September to the U.S. economy.

"It's telling us that expectations that we'd have a better second half than the first half are being fulfilled. There's nothing spectacular about 2.5% growth, but it's more than double what we had in the first half of the year," said David Resler, chief economist at Nomura Securities in New York, as reported by the BBC.

Despite the modest growth of the U.S. economy, U.S. consumer confidence has dropped in October to its lowest level since 2009.

The U.S. unemployment rate is at or above 9 percent since April, but the number of people lining up for unemployment benefits dropped slightly last week.