The US economy accelerated sharply in the three months to September, recording its strongest growth in two years as consumer spending and exports rebounded.
Gross domestic product expanded at an annual rate of 4.3%, up from 3.8% in the previous quarter and well above expectations of around 3.2%.
Despite uncertainty caused by changes in trade and immigration policies, ongoing inflation, and cuts in government spending, the economy has maintained solid momentum. Analysts say the latest figures show an economy that has repeatedly exceeded pessimistic forecasts since 2022.
Growth was driven largely by consumer spending, which rose at an annual rate of 3.5%, up from 2.5% in the previous quarter, with increased spending on health services. Exports also recovered strongly, rising 7.4%, while imports continued to fall, boosting overall growth. Government spending increased as well, led by higher defence outlays.
These gains offset weaker business investment and continued strain in the housing market, where high interest rates have limited affordability and supply.
Economists say the US is entering 2026 in a relatively strong position, with expected support from tax cuts and recent interest rate reductions by the Federal Reserve. However, some warn the pace of growth may be difficult to sustain.
Inflation picked up during the quarter, with the Federal Reserve’s preferred price measure rising to 2.8% from 2.1%. Analysts caution that higher prices, combined with a weaker labour market and fading household savings, could curb future consumer spending.
While the latest figures point to a resilient economy, signs are emerging that some households are beginning to rein in spending, raising questions about how long the current momentum can last.
