(RTTNews) - U.S. economic activity unexpectedly jumped more than previously estimated in the third quarter, according to revised data released by the Commerce Department on Thursday.
The report showed the surge in real gross domestic product in the third quarter was upwardly revised to 3.2 percent from the previously reported 2.9 percent. Economists had expected the pace of GDP growth to be unrevised.
The stronger than previously estimated growth in the third quarter came after GDP slumped by 1.6 percent in the first quarter and fell by 0.6 percent in the second quarter.
The Commerce Department said upward revisions to consumer spending and non-residential fixed investment were partly offset by a downward revision to private inventory investment.
"The unexpected upward revision to Q3 GDP is encouraging but the economy will be tested soon from past tightening in financial market conditions and rate hikes by the Fed," said Oren Klachkin, Lead U.S. Economist at Oxford Economics.
He added, "The revisions won't require a major revision to our Q4 2022 and 2023 forecasts but it does support our recent decision to push back the start of the recession to Q2 2023."
The notable rebound in GDP in the third quarter reflected increases in exports, consumer spending, non-residential fixed investment, and government spending along with a decrease in imports, which are a subtraction in the calculation of GDP.
Meanwhile, the positive contributions were partly offset by decreases in residential fixed investment and private inventory investment.
The Commerce Department said the annual rate of growth in core consumer prices, which exclude food and energy prices, was unrevised at 4.9 percent in the third quarter.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.