The U.S. economy expanded at a faster pace in the third quarter than previously reported, reflecting a smaller hit from efforts to control bloated inventories.
Figures released Tuesday by the U.S. Commerce Department show gross domestic product, the value of all goods and services produced, rose at a 2.1% annualized rate, up from an initial estimate of 1.5%. The report also showed corporate profits slumped while worker incomes jumped.
The report also says the consumer continues to power the U.S. economy, with cheap gasoline giving households the means and greater job security giving them the confidence to spend. Still, company stockpiles are still greater than sales, indicating that new orders and production will cool further to clear shelves and warehouses heading into 2016.
The third-quarter's expansion should set up the economy to achieve at least 2% growth in the second half of the year, and, in the wake of robust job growth in October and strong domestic demand, the Federal Reserve is expected to raise rates at its policy meeting, middle of next month.
The growth rate matched the median forecast of economists, as estimates ranged from 1.5% to 2.4%.
