Real gross domestic product -- the value of the production of goods and services in the United States, adjusted for price changes -- increased at an annual rate of 5.0 percent in the third quarter of 2014, according to the "third" estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 4.6 percent.
The GDP estimate released today is based on more complete source data than were available for the "second" estimate issued last month. In the second estimate, the increase in real GDP was 3.9 percent. With the third estimate for the third quarter, both personal consumption expenditures (PCE) and nonresidential fixed investment increased more than previously estimated
Paul Krugman comments on the report:
What 5 Percent Means: OK, that was a seriously impressive GDP report — 5 percent growth rate, and it’s all final demand rather than an inventory bounce. But what does it mean?
It does not necessarily mean that now is the time to tighten; that depends mainly on how far we still are from target employment and inflation, not on how fast we’re growing. ... It’s interesting to note that the bond market seems quite unimpressed, with only a slight uptick in long-term rates.
What the report should do, however, is further discredit the “Ma, he’s looking at me funny!” theory of the Obama economy. Remember, we were supposed to be having the worst recovery ever because Obama was a Kenyan socialist who scared businessmen. Actually, it’s a better recovery than the alleged Bush boom...