The sustained economic improvement, including a drop in the unemployment rate to 3.7 per cent, its lowest level in almost 50 years - has led the Federal Reserve to raise its benchmark interest rate three times this year.
The US economy, as measured by gross domestic product (GDP), expanded by an annualised rate of 3.5 per cent in the third quarter, according to an initial reading from the US commerce department. The American economy looks like it will expand above a 3% rate in 2018.
The economy did grow slower than the 4.2% pace of growth seen during the second quarter, but still indicates that economic growth remains strong after tax cuts passed by the President Donald Trump late past year. "The consumer accounts for 68 percent of overall GDP, and the consumer really drives the bus".
The US economy is underpinned by a $1.5 trillion tax cut and increased government spending.
The Congressional Budget Office points to several reasons for that: the expiration of personal income tax cuts, slower growth in federal spending, and higher interest rates and prices.
Positive Point for the GDP, the industrial have massively replenished their inventories contributing for 2.07 percentage points to growth, while the deterioration in the trade has on the contrary cost 1,78 point of growth.
The Bureau of Economic Analysis (BEA) found the economy grew at 3.5 percent during the third quarter, which beat expectations.
Consumer spending jumped at a 4 percent rate in the July-September quarter - the fastest in about four years and topping the 3.8 percent in the prior three months.
Yet a trade war exists between Washington and Beijing as well as other trade disputes between the US and other trade partners, with the slowdown last quarter mostly reflecting the retaliatory tariffs impact that Beijing imposed on exports from the USA including soybeans.
"In the big picture, what we're trying to ascertain is: is fiscal stimulus transitory or will it help sustain economic growth longer term?"
GDP measures the production of goods and services, but products that are not sold can pull down future production as businesses try to reduce their stocks of inventories. "This report shows the fiscal stimulus has a transitory response".
That was the fastest pace since the fourth quarter of 2014 and followed a 3.8% pace of increase in the second quarter.
The GDP report also comes at a good time for Trump and Republicans, as the party fights to hold onto control of the House and Senate in the midterm elections. World GDP would fall further should Trump follow through on all his trade threats, including global duties on cars, the International Monetary Fund said. Right now, the Fed is raising interest rates to keep inflation in check, a clear sign of concern the economy could overheat.
Investors have become less sanguine on the outlook amid the latest run of US company earnings reports, though stocks regained some ground October 25. "Housing remains a drag, however, as rates rise". Recent reports indicate the industry is slowing amid higher prices and rising mortgage rates, as well as a lack of affordable listings. This flipped the second quarter's results on their head, when Chinese importers raced to build stockpiles ahead of July's retaliatory tariffs by Beijing.