Inflation heats up again, data shows, days before midterm elections where cost of living dominates
Strong consumer spending and soaring investment in artificial intelligence infrastructure were key drivers of growth in the third quarter. When unemployment is as low as it is right now, consumers often spend at a healthy clip and they are doing so, particularly wealthier Americans who are riding a wave of record stock market gains. The economy grew at a strong 3.4% annual rate in the July-September quarter, the Commerce Department said Thursday, much faster than the 2.2% growth in the April-June quarter. Consumer spending climbed 3.8% at an annual rate, marking the second straight quarter of strong growth and far exceeding the 0.7% increase in the first three months of the year. Business investment, driven by spending on AI infrastructure, jumped 12.7%, the most in six years. Yet economists worry that persistently high prices are eroding Americans’ ability to keep up. Thursday’s data…