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U.S. GDP increases at fastest rate in two years in Q3

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Staff Writer | October 31, 2016
Economic activity in the U.S. increased by more than expected in the third quarter, according to a report released by the Commerce Department.
U.S. GDP increases
America   The Commerce Department:
The Commerce Department said real gross domestic product climbed by 2.9 percent in the third quarter after rising by 1.4 percent in the second quarter. Economists had expected 2.5 percent growth.

The stronger than expected GDP growth in the third quarter reflects the biggest increase since a 5.0 percent jump in the third quarter of 2014.

Paul Ashworth, Chief U.S. Economist at Capital Economics, said, "The bigger than expected 2.9% annualized gain in third-quarter GDP growth confirms that the economic recovery has regained some of the momentum lost within the last year."

"As such, this leaves the Fed firmly on track to raise interest rates in December and a hike at next week's FOMC meeting isn't entirely out of the question," he added.

A sharp jump in exports contributed to the stronger than expected GDP growth, with exports surging up by 10.0 percent in the third quarter after climbing by 1.8 percent in the second quarter.