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| US economy is growing once again | US economy is growing once again |
| (10 minutes later) | |
| The US economy grew at an annualised rate of 3.5% between July and September, its first expansion in more than a year, official data has shown. | The US economy grew at an annualised rate of 3.5% between July and September, its first expansion in more than a year, official data has shown. |
| Analysts say the growth was helped by the cash for clunkers car scrappage scheme, and the fear is growth will now fall after this ended in August. | |
| The US economy was also lifted by President Obama's $787bn (£480bn) economic stimulus plan. | |
| But with unemployment still high, the ongoing recovery is set to be slow. | But with unemployment still high, the ongoing recovery is set to be slow. |
| Global good news | Global good news |
| The economic growth between July and September indicates that the US has likely exited a recession that first started in December 2007. | The economic growth between July and September indicates that the US has likely exited a recession that first started in December 2007. |
| This recovery is being led by federal spending and gradual recovery in consumer spending and business investment John Silvia, Wells Fargo What next for US economy? href="http://www.bbc.co.uk/blogs/thereporters/markmardell/">Where hope is all that's left | |
| However, the official confirmation still has to come from the National Bureau of Economic Research, the agency which considers a number of factors in coming to its decision. | However, the official confirmation still has to come from the National Bureau of Economic Research, the agency which considers a number of factors in coming to its decision. |
| The US economy last expanded in the second quarter of 2008, when it grew 2.4%. | The US economy last expanded in the second quarter of 2008, when it grew 2.4%. |
| BBC chief economics correspondent Hugh Pym said the 3.5% growth was more than the 3.3% expected by most commentators. | BBC chief economics correspondent Hugh Pym said the 3.5% growth was more than the 3.3% expected by most commentators. |
| "The sheer scale of the stimulus in the US has made a big difference, it was much bigger in percentage terms than that in the UK," he said. | "The sheer scale of the stimulus in the US has made a big difference, it was much bigger in percentage terms than that in the UK," he said. |
| "That the US, the powerhouse of the world economy is growing once again, is good news for the global economy has a whole." | "That the US, the powerhouse of the world economy is growing once again, is good news for the global economy has a whole." |
| Numerous boosts | Numerous boosts |
| The figures from the Commerce Department showed that a number of factors helped to lift the economy during the third quarter. | The figures from the Commerce Department showed that a number of factors helped to lift the economy during the third quarter. |
| I've been out of work a few months here or there but never like this Unemployed American Jon Polis class="" href="/2/hi/business/8331110.stm">Pain continues for some | |
| Spending on durable manufactured products soared at an annualised rate of 22.3%, the highest quarterly amount since 2001, led primarily by the impact of the cash for clunkers scheme lifting car sales. | Spending on durable manufactured products soared at an annualised rate of 22.3%, the highest quarterly amount since 2001, led primarily by the impact of the cash for clunkers scheme lifting car sales. |
| The housing market also improved, with spending on housing products up 23.4%, its largest quarterly jump in 23 years. | The housing market also improved, with spending on housing products up 23.4%, its largest quarterly jump in 23 years. |
| Analysts said this big leap was sparked by the government's $8,000 tax credit for first-time house buyers. | Analysts said this big leap was sparked by the government's $8,000 tax credit for first-time house buyers. |
| Meanwhile, total government spending was up 7.9%, as the wider stimulus spending continued to take effect. | Meanwhile, total government spending was up 7.9%, as the wider stimulus spending continued to take effect. |
| In addition, exports were also up strongly, increasing 21.4%, the biggest rise since 1996. | In addition, exports were also up strongly, increasing 21.4%, the biggest rise since 1996. |
| 'Distorted by stimulus' | 'Distorted by stimulus' |
| "It's good to have the economy growing again," said Brian Bethune, economist at IHS Global Insight. | "It's good to have the economy growing again," said Brian Bethune, economist at IHS Global Insight. |
| "But we don't think that rate of growth is sustainable because it is distorted by all the government stimulus. | "But we don't think that rate of growth is sustainable because it is distorted by all the government stimulus. |
| "The challenge here is to get organic growth - growth that isn't helped by fiscal steroids." | "The challenge here is to get organic growth - growth that isn't helped by fiscal steroids." |
| Analysts cautious about the slow nature of the US economic recovery point to the fact that the unemployment rate currently stands at 9.8%, and that the labour market traditionally lags behind any wider economic recovery. | Analysts cautious about the slow nature of the US economic recovery point to the fact that the unemployment rate currently stands at 9.8%, and that the labour market traditionally lags behind any wider economic recovery. |
| They also highlight the fact that the big car firms have already reported a sharp fall in September sales following the conclusion of the popular $3bn cash for clunkers scheme at the end of August. | They also highlight the fact that the big car firms have already reported a sharp fall in September sales following the conclusion of the popular $3bn cash for clunkers scheme at the end of August. |
| "You can say that the recession is over, but it sure won't feel like that," said Dean Baker, co-director of the Centre for Economic Policy Research. | "You can say that the recession is over, but it sure won't feel like that," said Dean Baker, co-director of the Centre for Economic Policy Research. |
| "There is a lot of downward momentum that isn't going to go." | "There is a lot of downward momentum that isn't going to go." |