The US economy likely grew at its strongest rate in two years during the third quarter, rebounding from a steep downturn that began in December 2007, according to survey of top economists released on Saturday. Private economists polled October 5-6 for the Blue Chip Economic Indicators October survey said gross domestic product grew at an annualised rate of 3.2 percent in the quarter, up 0.2 percentage point from what they estimated a month earlier.
GDP shrank in the second quarter at a 0.7 percent annual rate. Third-quarter growth was fuelled by a rebound in personal consumption expenditures, the first increase in residential investment since the final quarter of 2005, and a reduced rate of business inventory reduction, the Blue Chip survey said.
The projected third-quarter growth would be the strongest since a 3.6 percent annual rate of GDP increase in the third quarter of 2007, according to Commerce Department figures. For the whole of 2009, Blue Chip forecasts the economy will shrink 2.5 percent, slightly below the 2.6 percent contraction forecast in September. In 2010 it will likely expand at a 2.5 percent pace, up from 2.4 percent seen last month.
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