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US economy grew only 1.8 per cent in Q3

The Commerce Department says the US economy grew at an annualized rate of 1.8 per cent in the third quarter and not 2.5 per cent as originally thought.

IANS   Washington     Last Updated: December 23, 2011  | 12:45 IST

The US economy grew at an annualized rate of 1.8 per cent in the third quarter and not 2.5 per cent as originally thought, the Commerce Department said on Thursday in its third and final estimate for the June-September period.

Data not available at the time of the initial estimate in October showed that consumer spending expanded by only 1.7 per cent in the third quarter, compared with a preliminary reading of 2.3 per cent.

Consumer spending accounts for nearly 70 per cent of US gross domestic product.

The revised report said prices of consumer goods excluding food and energy climbed 2.1 per cent in June-September, up slightly from the original estimate of 2 per cent.

The department also revised its calculation of the increase in after-tax corporate profits, from 2.5 per cent to 2.1 per cent.

More than two years after the official end of the worst economic slowdown since the 1930s, the pace of growth remains insufficient to make a dent in unemployment, currently at 8.6 per cent.

Meeting earlier this month, the Federal Reserve's Open Market Committee reiterated its concerns about joblessness and anaemic growth and said it would continue to keep its benchmark interest rate below 0.25 per cent.

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