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US exits recession; strongest growth in 2 yrs

business Updated: Oct 30, 2009 01:36 IST

Hindustan Times
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The US economy exited severe recession in the third quarter, posting the strongest growth in two years as government stimulus boosted consumer spending, government data showed on Thursday.

After four quarters of contraction, the economy grew at a seasonally adjusted 3.5 percent rate in the July-September period from the prior quarter, the Commerce Department reported.

It was strongest expansion since the 2007 third quarter, when a US subprime mortgage crisis triggered a global financial crisis that hammered the world economy, and marked the end of the worst recession since the Great Depression.

The department's first estimate of third-quarter gross domestic product (GDP), the broadest measure of the output of goods and services in the world's largest economy, topped the 3.2 percent rate expected by most analysts.

The department said the economy shrank an unrevised 0.7 percent in the second quarter.

The White House welcomed the news, saying that massive stimulus efforts by President Barack Obama’s administratione had fueled the growth.