WASHINGTON — The U.S. economy had some tailwind going into the government shutdown, growing at an annualized rate of 2.8 percent from July through September, the government said Thursday.
Most economists had projected growth as slow as 2 percent over the summer, so the report from the Bureau of Economic Analysis was a positive surprise. The third quarter growth surpassed the 2.5 percent annual rate from April to June.
Much of the third-quarter growth was attributed to businesses restocking their inventories, and within the broad measures of the economy's performance there were troubling signs too. Consumption, which drives about two-thirds of all economic activity, slowed in the quarter and the continued decline in federal spending also weighed against growth.
The protracted partial shutdown of the federal government and the political brinksmanship over potentially defaulting on U.S. debt are thought to have weighed heavily on consumer confidence. Economists are expecting a weaker final three months of the year as a result.