WASHINGTON — Sizzling. That might be the best way to describe the U.S. economy from July to September.
Growth estimates for the third quarter of 2013, already revised upwards earlier this month to an annual rate of 3.6 percent, were revised again by the Commerce Department on Friday to show that the economy grew at a pace of 4.1 percent.
That's much better than expected by most mainstream economists, and in an even more positive development the revision was due to fuller information that showed consumers spent more over the summer that first believed.
The strong revision from the Bureau of Economic Analysis helps explain why the Federal Reserve on Wednesday announced it'd begin the process of gradually removing the unconventional stimulus it has been providing to support the economy.
Taken together with improving hiring numbers and a falling unemployment rate, the outlook for 2014 is the rosiest it has been for a number of years.
"The third quarter data now show consumer spending grew at a relatively solid 2 percent annual rate," Doug Handler, chief U.S. economist for forecaster IHS Global Insight, said in a note to investors. "With the relatively strong October reading on personal consumption expenditures, and October and November's solid retail sales data, we can confirm the consumer's newly expanded role in the economy."
Exports and increased business investment helped push up the revised numbers, the BEA said, adding that these gains "were partly offset by a negative contribution from federal government spending."