WASHINGTON (AP) – The U.S. economy grew at a solid annual rate of 3.5 percent in the July-September quarter, propelled by solid gains in business investment, export sales and the biggest jump in military spending in five years.
The third quarter result, which was slightly better than economists expected, followed a 4.6 percent rebound in the second quarter, the Commerce Department reported Thursday. The economy shrank at a 2.1 percent rate in the first three months of the year due to a harsh winter.
The report was the first of three estimates of the gross domestic product, the economy’s total output of goods and services. Analysts believe the economy is maintaining momentum in the current quarter, with a big fall in gas prices expected to bolster consumer spending. After the roller-coaster first- and second-quarter gyrations, the economy is poised to achieve consistently stronger growth for the rest of this year and all of 2015.
“The economy does appear to be accelerating of late,” said Dan Greenhaus, an analyst with investment firm BTIG. He added that the GDP report showed an economy “on a sounder footing today than at any time over the last few years.”
Many economists think full-year growth for 2015 will hit 3 percent, giving the economy the best annual performance since 2005, two years before the Great Recession began.