US Economy Advanced Faster than First Thought in the Summer

Posted December 20th, 2012 at 3:55 pm (UTC-5)
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The U.S. economy advanced a bit faster in the summer months than the government first estimated, but it may be tailing off at the end of 2012.

The government Thursday said the economy, the world's largest, grew at a 3.1 percent pace in the July-to-September period. That was up from an earlier estimate of 2.7 percent, and more than twice the 1.3 percent growth recorded in the April-to-June quarter.

Officials say stronger health care spending and more exports led to the faster third quarter growth.

But analysts say the U.S. economic advance has slipped in the last three months of the year, and might total 1.3 percent. The fourth quarter economic fortunes were buffeted by the devastating superstorm Sandy that hit the country's eastern seaboard in late October, and ongoing uncertainty about the outcome of the contentious political fight in Washington over government tax and spending issues.

U.S. economic analysts say the country's economy could advance marginally faster in the first three months of 2013, perhaps nearing the 2 percent level.

In a separate report, a trade group, the National Association of Realtors, said sales of existing homes surged last month to their highest level in three years. The industry said the 2012 sales total may be the highest in five years.

The U.S. economy has struggled to fully recover from the depths of the recession in 2008 and 2009, the worst downturn since the Great Depression of the 1930s.

The country's jobless rate has declined, but remains elevated at 7.7 percent. The U.S. central bank, the Federal Reserve, is embarking on a new plan to buy government securities in hopes of keeping interest rates low to spur the country's economy and boost job growth.