US GDP Rises by 4.3% in 3Q, Fastest Pace in Two Years

Economic Data Summary - The GDP data released shows a surprising increase to 4.3%, significantly higher than the prior 3.8% and the expected 3.3% [1][4] - Durable goods orders, however, fell by 2.2%, indicating a mixed economic signal [2] Market Reaction - Following the GDP announcement, there was a notable spike in the two-year yield, reaching 3.5351, as traders reacted to the unexpected GDP growth [3] - The market's response suggests a selling trend in the front end of the yield curve, reflecting uncertainty about future interest rate adjustments [3] Federal Reserve Implications - The unexpected GDP growth raises questions about the Federal Reserve's decision to cut rates by 0.75% in September, which was primarily influenced by employment concerns [5] - There is a growing disconnect between rapid aggregate demand growth and sluggish employment figures, complicating the Fed's policy decisions [5] - The divided opinions among Federal Open Market Committee (FOMC) participants indicate that this new data point could influence future interest rate considerations [6][7]