US Third-Quarter GDP Expands 3.4% as Inflation Cools, Beating Market Estimates

The US economy expanded at an annualized rate of 3.4% in the third quarter of 2026, accelerating from 2.2% in the second quarter and topping market forecasts. Growth was driven by resilient consumer spending of 3.8%, strong business investment, inventory buildup, and government outlays, which offset drags from rising imports and falling exports. Price pressures eased significantly during the period: the headline PCE price index slowed to 2.1% from 5.0% in the prior quarter, the GDP deflator dropped to 2.2%, and core PCE inflation moderated to 2.5% from 3.3%.