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Consumers fuel economy

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Posted: Wednesday, December 1, 2004 5:41 am | Updated: 4:46 pm, Thu Oct 6, 2011.

WASHINGTON - Splurging shoppers helped the economy hum along faster than first thought in the third quarter, but high energy prices could weigh on consumers in the months ahead.

Gross domestic product — the value of all goods and services produced within the United States — increased at an annual rate of 3.9 percent in the July-to-September quarter, the Commerce Department reported Tuesday.

‘‘I think the economy has found its groove,’’ said Mark Zandi, chief economist at Economy.com.

But sinking confidence among consumers raised new questions about their appetite to spend in coming months. The Conference Board’s Consumer Confidence Index fell to an eight-month low of 90.5 in November, the fourth month in a row that confidence declined.

‘‘I think the decline in consumer confidence hoists a little yellow warning flag,’’ said Richard Yamarone, economist at Argus Research Corp.

The new GDP figure was up from an initial estimate of a 3.7 percent growth rate for the third quarter and was better than a 3.3 percent pace posted in the second quarter.

After adjusting for inflation, the economy grew to $10.9 trillion, on an annualized basis, in the third quarter.

The main reasons for the improvement: Stronger consumer spending, which grew at a 5.1 percent pace, the fastest clip since the end of 2001, and more robust business investment in equipment and software. Better growth in U.S. exports also helped.

‘‘Consumers are alive and well but not as lively as in the summer,’’ said Stuart Hoffman, chief economist at PNC Financial Services Group. Hoffman expects GDP to slow to a still respectable 3.25 percent rate in the October-to-December quarter. Others think it could clock in at around a 4 percent pace.

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