US economy grew at strong 3.5 pct. annual rate last quarter

Markets Associated Press

FILE - In this Friday, Nov. 25, 2016, file photo, Hunter Harvey helps his dad, C.J., wheel a big screen TV at Target, in Wilmington, Mass. The U.S. economy grew at a 3.5 percent annual rate in the July-September quarter, the fastest pace in two years ... and more than the government had previously estimated. But the growth spurt isn’t expected to last. The gain in the gross domestic product, the economy’s total output of goods and services, came from added strength in consumer spending, business investment and the government sector, the Commerce Department said Thursday, Dec. 22. (AP Photo/Elise Amendola, File) (The Associated Press)

The U.S. economy grew at a 3.5 percent annual rate in the July-September quarter, the fastest pace in two years and more than the government had previously estimated. But the growth spurt isn't expected to last.

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The Commerce Department says the gain in the gross domestic product, the economy's total output of goods and services, came from added strength in consumer spending, business investment and the government sector. The government had previously estimated last quarter's annual growth rate at 3.2 percent.

The third quarter increase was a sharp acceleration from tepid annual growth of 0.8 percent in the first quarter and 1.4 percent in the second. Growth is expected to slow to roughly a 1.5 percent rate in the current quarter, reflecting in part less consumer spending and business stockpiling.