Breaking: US GDP Rises 2 Percent in Third-Quarter (Consumers Boost Growth Despite Business Caution) [View all]
Consumers boost growth despite business caution
Fri Oct 26, 2012 8:35am EDT
By Lucia Mutikani
WASHINGTON (Reuters) - Economic growth picked up in the third quarter as a late burst in consumer spending offset the first cutbacks in investment in more than a year by cautious businesses.
The stronger pace of expansion, however, fell short of what is needed to make much of a dent in unemployment, and offers little cheer for the White House ahead of the closely contested November 6 presidential election.
Gross domestic product expanded at a 2.0 percent annual rate, the Commerce Department said on Friday, accelerating from the second quarter's 1.3 percent pace. A pace in excess of 2.5 percent is needed over several quarters to make substantial headway cutting the jobless rate.
Economists polled by Reuters had expected a 1.9 percent growth pace in the third quarter. The report comes a little more than a week before the election in which President Barack Obama is trying to fend off Republican challenger Mitt Romney.