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Gross domestic product grew at a 4.3 percent annual rate, faster than the previous three months.
Dec. 23, 2025Updated 11:24 a.m. ET
The U.S. economy grew at a vigorous pace through the end of September, despite the uncertainty created by tariffs and widespread concerns about affordability among households.
Economic growth rose at a 4.3 percent annual rate in the third quarter, the Commerce Department reported Tuesday, an acceleration from the previous quarter.
The third-quarter reading showed that, even in the face of negative consumer sentiment and a softening job market, the roughly $30 trillion economy started October on relatively solid footing as a whole, outperforming the bearish expectations of some experts only months before.
“It shows an economy that is mostly solid, actually still firing on most cylinders if not all cylinders, though I still think we have a lot of noise in the quarter to quarter data,” said Michael Pearce, chief U.S. economist at Oxford Economics. “Most of the strength is coming from wealthier households.”
Disposable personal income, after taxes and adjusted for inflation, was flat, a sign of nagging price increases still eating into purchasing power. Yet a barometer of underlying growth that measures both private investment and household consumption held firm, a signal of underlying strength.
Much of the growth in the third quarter came from military spending. Total corporate profits rose by $166 billion in the third quarter, compared with an increase of $6.8 billion in the previous quarter, a sharp improvement. But business investment, which has been fueled by the build-out of A.I. systems, notably cooled.
