US GDP accelerates to 3.4% in third quarter, giving Trump a boost ahead of midterm elections

The U.S. economy experienced robust growth in the third quarter, driven by investment, consumer spending and government spending.

Gross domestic product grew at an annualized rate of 3.4%, according to an initial estimate released Thursday by the U.S. Bureau of Economic Analysis, beating economists’ expectations of 3.1% and marking an acceleration from 2.2% growth in the second quarter.

Learn more: What is GDP and why is it important to economists and investors?

The development of artificial intelligence was the main driver, with business investment increasing by 12.7%. Consumer spending rose 3.8%, the rate of the second quarter and the strongest since late 2024. The Conference Board reported this week that consumer confidence is improving, despite persistent inflation and higher gasoline prices.

Growth in the third quarter was partly offset by a decline in exports. Imports, subtracted from the GDP calculation, increased.

The release is the last major report on the economy before next week’s midterm elections, as President Trump and the Republicans deliver their closing message.

The White House was quick to tout the news. Trump told reporters before heading to a campaign rally: “We had a great morning from a GDP perspective.” The White House added on X that it was a “’MAJOR BOOST FOR THE ECONOMY.’

Liz Ann Sonders, chief investment strategist at Charles Schwab, added on X that it was “another strong Q for investing.” But she stressed that growth “continues to be somewhat offset by the drag on net exports,” noting that AI development “is heavily driven by imports.”

Heather Long, chief economist at Navy Federal Credit Union, wrote on X: “Consumption was still strong. But business investment is boosting the U.S. economy. »

Molly Moorhead is a business editor at Yahoo Finance.