Coming off the worst quarter in history, the U.S. economy grew at its fastest pace ever in the third quarter as a nation battered by an unprecedented pandemic started to put itself back together.Third-quarter gross domestic product, a measure of the total goods and services produced in the July-to-September period, expanded at a 33.1% annualized pace, the Commerce Department reported Thursday in its initial estimate for the period.Markets reacted positively to the news, with Wall Street now looking at a flat to slightly positive open.That came after a 31.4% plunge in the second quarter and was better than the 32% estimate from economists surveyed by Dow Jones. The previous post-World War II record was the 16.7% burst in the first quarter of 1950.Increased consumption along with sold gains in business and residential investment as well as exports fueled the third-quarter rebound. Decreases in government spending following the expiration of the CARES Act rescue funding subtracted from GDP.The powerful growth pace came after governments across the country shut down large swaths of activity in an effort to stem the spread of Covid-19, which the World Health Organization declared a pandemic on March 11.Since then, some 228,000 American lives have been lost to the virus, which has infected nearly 9 million. The economy has been in a technical recession since February, as first-quarter growth declined at a 5% pace.While the news on Q3 was good, the U.S. faces a tougher road ahead as coronavirus cases increase and worries grow over the health and economic impacts. Nearly half the 22 million jobs lost in March and April remain unfilled and the unemployment rate remains at 7.9%, more than double its pre-pandemic level as 12.6 million Americans are still out of work.Q3 growth came amid a resurgence in consumer activity, which comprises about two-thirds of GDP. Though most of the country remained in a cautious reopening, shoppers began returning to stores and the bar and restaurant industry entered the first tepid phase of resuming business despite restrictions on capacity.Economic activity was strong in the real estate sector, and consumer and business executive surveys showed that confidence has remained high about the future despite the virus-related setbacks.Personal income fell sharply for the quarter as transfer payments from coronavirus relief efforts dissipated. Personal savings also declined but remained strong at a 15.8% rate, down from the record 25.7% in Q2.This is breaking news. Please check back here for updates.
