The U.S. economy grew at an annual rate of 3.4% in the third quarter of 2026, its fastest pace in a year, as consumer spending remained strong and AI-related investment surged, according to the Commerce Department’s first estimate.
Growth from July through September accelerated from 2.2% in the second quarter. It was higher than many economists had expected. The annualized figure shows how much the economy would grow over a year if the quarter’s pace continued.
The actual increase from the previous quarter, after adjusting for inflation, was about 0.8%. Consumer spending, a major source of U.S. economic activity, rose at a 3.8% rate, matching the previous quarter’s pace. Business investment also contributed to growth.
Nonresidential investment, which excludes housing, rose 12.7%. Spending on information-processing equipment jumped 37.4%, reflecting efforts to expand AI. Not all parts of the economy grew.
Residential investment fell 3.3% amid high mortgage rates. Falling exports and rising imports partly offset growth in other areas. Government spending also helped support output, according to the government’s report.
The 3.4% figure is an advance estimate. The Commerce Department is due to issue updated estimates as more data become available.