NPR

GDP report shows an economic turnaround, but don’t be fooled : NPR

The government's official scorecard shows a rebound in economic growth during the late summer and early fall. But analysts say it overstates the strength of the U.S. economy, just as earlier figures painted an exaggerated picture of weakness.

A report from the Commerce Department released on Thursday shows the nation's gross domestic product grew at an annual rate of 2.6% in July, August and September. That's in contrast to the first six months of the year, when GDP figures showed the economy shrinking.

The apparent improvement, however, is largely the result of fluctuations in things like international trade, which don't reflect the underlying health of the economy. They made GDP look artificially weak in the first half of the year, while pumping up the most recent figure.

"If you take a step back and look at GDP, it's gone effectively nowhere over the last year," says Mark Zandi, chief economist at Moody's Analytics. "One quarter or two it's down a bit. This quarter it's up a bit. But net-net, we're kind of treading water."