Economy Shows Modest Growth

The economy grew at a 2.5 percent annual rate in the third quarter after coming to a near standstill in the first six months of the year.

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ARI SHAPIRO, HOST:

NPR's business news starts with the economy still treading water.

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SHAPIRO: A report out this morning by the Commerce Department says consumers spent enough, and businesses invested enough over the summer to keep the economy from falling into recession. The government says in the latest quarter, from July to September, the gross domestic product grew at an annual rate of 2.5 percent. That's the country's total output of goods and services.

It's healthy growth compared to the anemic numbers in the previous two quarters, so many economists are relieved. But others still see reason for concern. For one, consumers had to dip into their savings to do all that spending, so the savings rate fell. As a result, some economists wonder if Americans will be able to keep up that rate of spending. Then there's the high jobless rate and the poor housing market, both of which continue to drag the economy.

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