US GDP Accelerates to 3.4% in Third Quarter on Consumer Spending, AI Investment Boom

The U.S. economy grew at a 3.4% annual pace from July through September, up from 2.2% in the second quarter, the Commerce Department said Thursday, driven by strong consumer spending and a surge in artificial intelligence investment. Consumer spending rose 3.8% in the third quarter, while non-housing business investment climbed 12.7%. Investment in information processing equipment jumped 37.4%, software rose 9.6% and research and development gained 7.5%. Economists surveyed by FactSet had forecast 3% GDP growth. Housing investment fell 3.3%, pressured by high mortgage rates, and has declined in six of the past seven quarters. The report is the first of three Commerce Department estimates of third-quarter GDP growth. The economy has proven resilient despite higher energy prices caused by fighting with Iran.