The increase in US real GDP in the third quarter of 2009 reflects mostly increases in personal consumption expenditures, residential fixed investment, federal government spending, exports, and private inventory investment.

Real personal consumption expenditures increased 3.4% in the third quarter, following a decrease of 0.9% in the second. Durable goods, driven by motor vehicle purchases under the Consumer Assistance to Recycle and Save Act of 2009, increased 22.3% following a decrease of 5.6% in the previous quarter. Nondurable goods increased 2.0% while services increased 1.2%.

Real residential fixed investment posted a very strong increase of 23.4% in Q3 2009, following a decrease of 23.3% in the previous quarter. Real nonresidential fixed investment though continued declining at an annual rate of 2.5%, which is considerably lower than the decrease of 9.6% registered in the second quarter.

The big question mark of course is the sustainability of the growth that was registered by the US economy in the third quarter with most concerns arising from the deteriorating labor market.

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