The U.S. economy performed slightly better during the third quarter than previously thought, the Commerce Department said Tuesday in its latest growth estimate.
The department said in its first estimate in October that the economy grew by 33% in Q3 and the figure was increased 0.1% in the second report last month. Growth for the July-to-October period was finally revised up to a record 33.4% in Tuesday’s report.
The department said the upward revision for Q3 was a result of larger increases in personal consumption expenditures and nonresidential fixed investment.
“The increase in third quarter GDP reflected continued efforts to reopen businesses and resume activities that were postponed or restricted due to COVID-19,” the department said in a statement.
“The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the third quarter of 2020 because the impacts are generally embedded in source data and cannot be separately identified.”
The economy remains about 3.5% behind its level at the end of 2019. U.S. gross domestic product declined by a record 31.4% in the second quarter and 5% in the first quarter of 2020.
The department will release its first estimate of the U.S. economy’s fourth-quarter performance late next month.
A number of factors are expected to aid the economic performance in the final quarter, including traditional holiday spending and potentially a new round of coronavirus relief. Congress passed a $900 billion package on Monday that will send a second direct stimulus payment of $600 to most Americans. That money could start to be deposited into accounts as soon as next week.
Tuesday’s economic report also said the rise in personal consumption in Q3 was buoyed by an uptick in healthcare, food services and goods like clothing, footwear, motor vehicles and parts.
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