U.S. growth revised higher, economy on firmer footing, GDP grew at 4.1%

(Reuters) - The U.S. economy grew at its fastest pace in almost two years in the third quarter, the government said on Friday as it revised its estimates of business and consumer spending higher.The broad revisions hinted at some underlying strength, which could help the economy better absorb the blow from an anticipated cutback in inventory accumulation this quarter.

The Federal Reserve on Wednesday gave the economy a vote of confidence, announcing it would reduce its $85 billion monthly bond purchases by $10 billion starting in January.

Gross domestic product grew at a 4.1 percent annual rate instead of the 3.6 percent pace reported earlier this month, the Commerce Department said in its third estimate.

That was the quickest pace since the fourth quarter of 2011 and an acceleration from the April-June quarter's a 2.5 percent.

Economists had expected third-quarter GDP growth would be unrevised at a 3.6 percent rate.
"This is a fairly solid report, said Ryan Sweet, senior economist at Moody's Analytics in West Chester, Pennsylvania, adding that the mix of factors in the report was more positive than expected.

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