World Economy

U.S. Economy Expands 3.4% in Q3 on Consumer Spending Surge

The U.S. economy expanded at an annual rate of 3.4% in the third quarter, according to a Commerce Department report released Thursday. This marked significant acceleration from the prior quarter. Consumer spending drove much of the growth, particularly among higher-income households better positioned to absorb persistent inflationary pressures. Investment activity, especially from AI companies building data centers, also contributed substantially to the expansion. The economic data emerges days before midterm elections, though sentiment remains mixed among Americans. Lower-income households continue facing affordability challenges as wage growth lags inflation. Energy costs have climbed amid geopolitical tensions. Consumer spending patterns remain uneven, with higher earners maintaining purchasing momentum while middle and lower-income families curtail discretionary spending and delay major expenditures.