Global economy accelerates in third quarter

Is the US economy strong or what? Reuters has the answer:

Gross domestic product, a measure of all goods and services produced within U.S. borders, grew at a revised 4.3 percent annual rate in the third quarter, the fastest pace since the first three months of 2004, the Commerce Department said. Growth had initially been reported at 3.8 percent...

The stronger GDP growth in the third quarter was attributed to higher spending by both businesses and consumers. Consumer spending advanced at a solid 4.2 percent pace, above the 3.9 percent rate first reported. Spending on housing grew at an 8.4 percent pace, up from the 4.8 percent growth first reported, after a 10.8 percent surge in the second quarter.

Business spending was also robust, climbing at an 8.8 percent pace, above the initially estimated 6.2 percent growth.

And the outlook remains strong.

The National Association of Purchasing Management-Chicago said its business barometer came in at 61.7, compared with 62.9 in October and above Wall Street forecasts for 60.0. The prices paid index surged to 94.1 from 79.6 in October.

There were other indicators of inflation:

A price gauge favored by the Federal Reserve -- personal consumption expenditures excluding food and energy -- rose just 1.2 percent in the July-to-September period, down from the originally reported 1.3 percent pace...

The Federal Reserve also raised a small inflation flag in its "beige book" summary of economic conditions, noting that some businesses were able to pass on higher costs for energy, raw materials and transportation to consumers.

Growth in Europe also accelerated in the third quarter.

Both euro-zone and EU25 GDP grew by 0.6% in the third quarter of 2005, compared to the previous quarter, according to first estimates released by Eurostat, the Statistical Office of the European Communities. In the second quarter of 2005, growth rates were +0.4% in both zones.

Compared to the third quarter of 2004, GDP rose by 1.6% in the euro-zone and by 1.7% in the EU25, after +1.2% and +1.4% respectively in the previous quarter.

But inflation stayed moderate.

Euro-zone annual inflation is expected to be 2.4% in November 2005 according to a flash estimate issued by Eurostat, the Statistical Office of the European Communities. It was 2.5% in October.

And there was economic acceleration in Canada as well, as Bloomberg reports.

Canada's economy expanded at a 3.6 percent annual rate in the third quarter, the fastest in a year, as exports of cars surged and high energy prices boosted corporate profits.

Growth in the world's eighth-largest economy accelerated from a 3.4 percent pace in the second quarter that was faster than the original estimate of 3.2 percent, Statistics Canada said in Ottawa today. Third-quarter growth matched the median estimate of 21 economists surveyed by Bloomberg News...

Growth was flat in September...

The Ottawa-based agency said its chain price index, which gauges prices across the economy, rose 1.9 percent in the third quarter, the most in 22 years.

Not to be left out in this flow of strong economic numbers is Japan, as Reuters reports its strong November PMI.

Manufacturing activity in Japan expanded at the fastest pace in 18 months in November as robust demand at home, especially for cars, offset a lukewarm rise in orders from overseas, a survey showed on Wednesday.

The NTC Research/Nomura/JMMA Purchasing Managers Index, which gives an early snapshot of manufacturing activity, stood at a seasonally adjusted 55.3, the highest reading since May 2004 and up from 54.7 in October...

The new orders index, a barometer of future demand that combines goods orders from home and overseas, was 57.8 -- a 22-month high and jumping from 56.6 in October...

The input prices index came in at 63.2, down from 64.2.

At the other end of the production line, the output prices index slipped to 49.4, below 50 for the first time in 14 months. It was 51.0 a month earlier.

But it looks like a blue Christmas in the UK for consumers and retailers, if this Reuters report is anything to go by.

Consultancy GfK NOP said its barometer of consumer sentiment held steady at -8 in November, the lowest since the start of the Iraq war in March 2003...

Shopper traffic at the country's shopping centres, retail parks and high streets fell 3.7 percent in the week to November 27 compared with the same week a year ago, business information group FootFall said on Tuesday.