US economy grows at fastest rate in 11 years

Annualised US GDP growth grew at its quickest rate for 11 years after revised data from the Bureau of Economic Analysis showed the economy expanded by 5 per cent in the third quarter of 2014.

Faster consumption growth lead the BEA to upgrade its third and final estimate for GDP growth by 110 basis points from its second estimate of 3.9 per cent and according to Capital Economics the outlook “remains rosy” going into 2015.

Senior US economist Paul Dales notes that growth will not be as strong in the fourth quarter of 2014, with last month’s durable goods orders figures suggesting business investment has slowed significantly.

“Nonetheless, we still expect fourth quarter GDP growth to be around 3 per cent, largely due to another decent rise in consumption,” he says.