WASHINGTON (AP) – The US economy appears to have grown over the summer faster than first thought.
US companies sold more goods overseas in September, helping narrow the nation’s trade gap substantially. And wholesale companies boosted their stockpiles after reporting their best sales in 18 months.
Those figures could lead the government to sharply revise its estimate of the economy’s growth rate in the July-September quarter up from the two percent annual rate it estimated last month.
Macroeconomic Advisers predicted Friday that the government will estimate the economy’s third-quarter growth rate at 3.2 percent when it issues its second estimate on Nov. 29. Economists at Barclays also predict growth at that rate. Economists at High Frequency Economics said estimated growth could be raised to 3.1 percent.
If they are correct, it would mark only the third quarter since the recession officially ended in June 2009 that the economy has grown at an annual rate above three percent.
“The third quarter is coming in much stronger than anybody had expected,” said Ben Herzon, an economist at Macroeconomic Advisers.
Economists grew more optimistic Friday after seeing two September reports from the Commerce Department that weren’t included in the government’s initial estimate of growth, released Oct. 26.
Wholesale stockpiles grew 1.1 percent in September, and sales at the wholesale level rose two percent, according to a report released Friday. When businesses order more goods, it generally leads to more factory production and that boosts economic growth.
The inventory data followed a government report Thursday that the US trade deficit narrowed to its lowest level in nearly two years because exports rose in September to a record high. That means US companies earned more from overseas sales while consumers and businesses spent less on foreign products.
The current October-December quarter began with promising signs on jobs and consumer spending.