The gross domestic product (GDP) grew at a 3.7% seasonally adjusted annual rate in the third quarter of last year, adjusted for price changes. This final estimate is only slightly lower than the 3.9% preliminary estimate of November, reflecting slightly lower exports and higher imports. Indeed, third-quarter growth was surprisingly strong. As recently as September, analysts had forecast growth of about 2.0%, comparable to the second-quarter rate of 1.8%. Strength in third-quarter growth came mainly from personal consumption expenditures and inventory investment; small gains in residential investment and government spending were offset by declines in business fixed investment and net exports. The December Blue Chip consensus forecast for 1998:IVQ remains at about 2.5%.
Suggested citation: "Economic Activity," Federal Reserve Bank of Cleveland, Economic Trends, no. 99-01, pp. 09-10, 01.01.1999.