Household final consumption expenditure advanced 0.7% in the third quarter, a slower pace than in the second quarter (+1.1%). Consumers increased spending on goods by 0.9%, led by durable goods (+3.0%), whereas spending on services grew 0.5% following a stronger second quarter. Transport purchases (+2.1%) contributed the most to the growth in household final consumption, boosted by a 4.6% increase in purchases of vehicles. Outlays on housing, water, electricity, gas and other fuels (+0.5%), recreation and culture (+1.0%) and furnishings, household equipment and other goods and services (+1.1%) also contributed to the growth.
Business gross fixed capital formation was up 1.5 percent. Business investment in residential structures rose 3.0 percent, the fastest pace since the first quarter of 2012. Ownership transfer costs (+7.3 percent), an indicator of resale activity, and new home construction (+2.3 percent) were the main contributors to the growth. Business investment in non-residential structures, machinery and equipment edged up 0.1 percent.
Exports of goods and services advanced 1.7 percent after increasing 4.4 percent in the second quarter. Imports rose 1.0 percent despite a 1.4 percent decline in imports of services.
Businesses added $624 million in inventories in the third quarter, after accumulating $4.8 billion in the second quarter. Inventory accumulation has slowed throughout 2014.
The value added of service industries grew 0.8 percent in the third quarter. There were notable gains in wholesale and retail trade, finance and insurance services, at offices of real estate agents and brokers and in professional services. Increases were also recorded in the public sector (education, health and public administration combined), transportation and warehousing services as well as accommodation and food services.
The output of goods-producing industries edged up 0.1 percent in the third quarter. Notable gains in manufacturing and construction were mostly offset by declines in the agriculture and forestry, mining and oil and gas extraction, and utilities sectors.
Expressed at an annualized rate, real GDP expanded 2.8 percent in the third quarter.