US GDP growth in Q3 up 3.5%, Eurozone jobless hits 9.7%

The economic highlights over the past week were mainly focused on the US third-quarter Gross Domestic Product growth and the rise in Eurozone unemployment.

In the US, the economy grew in the third quarter for the first time in a year, beating market expectations. In fact, in its first estimate of third-quarter GDP results, the Commerce Department announced that the economy grew at an annual rate of 3.5%, which was the fastest increase since the third quarter of 2007.

The GDP growth was well above market expectations of a 3.3% increase. Moreover, the third-quarter recovery was generally broad-based, with solid gains in consumer spending, exports and home construction. Meanwhile, also on a positive note, the number of Americans collecting unemployment benefit fell more than forecast to the lowest level in seven months. The number of people claiming benefit declined by 148,000 to 5.8 million in the week ended October 17.

Eurozone unemployment in September edged up further to 9.7% as predicted. However, there are numerous regional differences in the rate of unemployment throughout the Eurozone. The highest levels were registered in countries such as Spain and Ireland where the rate of people without a job increased to 19.3% and 13% respectively.

Meanwhile, rising optimism in industry and services boosted Eurozone economic sentiment by much more than expected, jumping to a reading of 86.2 points in October from 82.8 in September.

In the UK, British house prices posted their first annual gain since early 2008, rising 0.4% in October, leaving them 2% higher than a year ago.

Consumer confidence in October also rose to its highest level in 21 months on a perception of positive economic conditions. However, given the bleak outlook for jobs and wages analysts have questioned how long this will last.

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