by Emmitt Barry, Worthy News Washington D.C. Bureau Chief
(Worthy News) – The U.S. economy expanded at a stronger-than-expected 3.4% annualized rate during the third quarter of 2026, accelerating sharply from 2.2% in the previous quarter as consumer spending and business investment fueled growth despite persistent inflation and rising energy costs.
The Commerce Department’s Bureau of Economic Analysis reported Thursday that gross domestic product (GDP) exceeded economists’ forecasts of approximately 3.2%, providing an encouraging sign of economic resilience under President Donald Trump’s administration.
Consumer spending, the largest component of the American economy, increased 3.8%, while business investment surged as companies poured billions into artificial intelligence infrastructure, computer equipment, and data centers.
Investment in business equipment climbed nearly 21%, helping drive the economy’s strongest quarterly expansion in a year.
Strong Growth Despite Inflation Pressures
The encouraging economic figures arrive as American households continue struggling with elevated gasoline prices, inflation, and borrowing costs.
Although economic growth accelerated, the Federal Reserve’s preferred inflation gauge remained at 3.6% annually in September, considerably above the central bank’s 2% target.
The Federal Reserve voted Wednesday to maintain its benchmark interest rate at 3.75% to 4%, citing continued inflation concerns despite strengthening economic activity.
The latest GDP figures also arrive just days before the November 3 midterm elections, giving the Trump administration a significant economic achievement to highlight as Republicans seek to maintain control of Congress.
Nevertheless, economists caution that rising energy costs, sluggish hiring, and persistent inflation could challenge the expansion heading into 2027.
The Commerce Department is scheduled to release its revised third-quarter GDP estimate on November 25.
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