The U.S. economy grew at a 3.4% annualized pace in the third quarter, according to the Bureau of Economic Analysis’s advance estimate released Thursday.

The outcome topped economist expectations of 3.2% and marked an acceleration from the 2.2% growth in the second quarter.

Real consumer spending grew 3.8%, the same pace as in the second quarter.

In a separate release, September’s personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation gauge, rose 3.6% from a year earlier in September, matching expectations and accelerating from 3.4% in August.

On a monthly basis, prices rose 0.5%, also as expected.

Core PCE rose 3.1% year over year, in line with estimates and up from 3% previously. Month over month, core prices rose 0.3%, matching the consensus.

Personal income rose 0.2% in September, below the 0.3% forecast. Personal spending increased 0.5%, versus expectations of 0.6% and 0.9% in August.

On Wednesday, the Federal Reserve held interest rates steady at 3.75%-4.00%, pausing after the September hike.

This is a developing story…