The Commerce Department’s initial estimate for third-quarter gross domestic product (GDP) showed the economy expanded at a seasonally adjusted annual rate of 4.3%, accelerating from a 3.8% increase in the prior quarter. The stronger performance was driven primarily by consumer spending, which rose 3.5%, along with an increase in government spending of 2.2% and an acceleration in exports, which advanced 8.8%. These gains were partly offset by a slight 0.3% decline in gross private domestic investment. Imports, which subtract from GDP, fell 4.7%, providing a notable lift to headline growth. Inflationary pressures picked up during the quarter, with the price index for gross domestic purchases rising 3.4%, up from 2.0% in Q2. The PCE price index increased 2.8%, while the core PCE index, excluding food and energy, climbed 2.9%, compared with 2.6% previously. Despite the strong headline GDP figure, real final sales to private domestic purchasers — a key measure of underlying demand — increased a more moderate 3.0%, only slightly faster than the 2.9% pace recorded in the prior quarter.

In December, The Conference Board Consumer Confidence Index® declined by 3.8 points to 89.1, following an upwardly revised 92.9 reading in November. The drop reflected a deterioration in consumers’ views of current business and labor market conditions, while expectations for the months ahead remained subdued. The Present Situation Index fell sharply by 9.5 points to 116.8, indicating weaker assessments of both business conditions and job availability. Meanwhile, the Expectations Index held steady at 70.7, marking the eleventh consecutive month below the 80 threshold that typically signals recession risk. Inflation concerns persisted but eased modestly, as both median and average 12-month inflation expectations retreated after November’s uptick. Plans to purchase big-ticket items remained cautious, with intentions to buy new cars continuing to slip, interest in used vehicles edging higher, and homebuying plans ticking down. Overall, consumers signaled a more restrained spending outlook, favoring necessary services and value-oriented purchases amid ongoing economic uncertainty.

The U.S. Census Bureau reported that new orders for manufactured durable goods decreased (-2.2%) in October to $307.4 billion, following a modest (+0.7%) increase in September. The decline was primarily driven by transportation equipment orders, which fell $7.2 billion (-6.5%) to $103.9 billion after two consecutive months of gains. Orders excluding transportation rose slightly (+0.2%). Shipments of manufactured durable goods increased for the second month in a row, up $1.8 billion (+0.6%) to $309.6 billion, with transportation equipment shipments leading the advance, rising $1.4 billion (+1.4%) to $102.6 billion. Unfilled orders climbed (+0.2%) to $1,492.8 billion, marking gains in 15 of the past 16 months, while durable goods inventories edged higher (+0.1%) to $590.5 billion following a September decline. Core capital goods new orders—nondefense capital goods excluding aircraft—increased (+0.5%) to $78.0 billion, while core capital goods shipments increased (+0.7%) to $77.7 billion.