US GDP third quarter estimate revised higher to 2.1% as expected

US economic growth was revised higher in the third quarter in line with analysts' expectations, the Commerce Department revealed on Tuesday.

The second estimate of gross domestic product was raised to an annualised 2.1% from a previous 1.5%. The decrease in private inventory investment was smaller than previously estimated, the Commerce Department said. GDP rose 3.9% in the second quarter.

The increase in third quarter GDP was driven by personal consumption expenditures, non-residential fixed investment, state and local government spending, residential fixed investment and exports that were partly offset by a negative contribution from private inventory investment.

"We look for 3% fourth quarter GDP, a bit less than previously because the scope for an inventory rebound has
been greatly reduced by the revised Q3 numbers," said Ian Shepherdson, chief economist at Pantheon Macroeconomics.