U.S. GDP revised up: Economy grew at 2.7 percent

WASHINGTON The U.S. economy grew at a faster 2.7 percent annual rate from July through September, although the strength may fade in the final months of the year.

The Commerce Department says growth in the third quarter was much better than the 2 percent rate estimated a month ago and more than twice the 1.3 percent rate logged in the April-June quarter.

The two biggest factors in the upward revision were larger gains in business stockpiles and a boost in export sales. That offset weaker consumer spending.

Economists believe growth is slowing to a rate below 2 percent in the current October-December quarter because of disruptions from Superstorm Sandy and worries about sharp tax increases and spending cuts that would occur in January without a budget deal in Washington.

Editor's note: This Associated Press article was posted minutes after the Commerce Department released the third quarter GDP report. It has since been replaced by a staff-written report. You can find the latest report and reader comments here.