Economic growth slows to 1.5 percent in the third quarter

The weaker-than-expected report is just one of several recent underwhelming updates on the strength of the U.S. economy.

For the Federal Reserve, which declined to raise interest rates at a meeting ending Wednesday, Thursday’s report will raise further questions about whether economic growth is self-sustaining enough for the central bank to tighten monetary policy in the next six weeks.

Yet Thursday’s report was not as weak as it might appear from the headline.

Economists expected some slowdown in growth because of an anticipated reversal of business inventory build-up from the previous quarter. That’s what happened: Businesses added less inventory, subtracting 1.44 percentage points from the third quarter growth rate. Inventories are generally not predictive of future growth.

Setting aside inventories, growth was 3 percent.

Furthermore, some of the slowdown in growth was clearly attributable to economic developments that Fed Chairwoman Janet Yellen has claimed will prove only temporary. Exports slowed and imports grew in the quarter, likely reflecting the continued fallout from the rising strength of the dollar. Recent slowing growth in China and in emerging market economies has propped up the dollar, making U.S. manufacturers’ products relatively more expensive to people outside the economy, and imports cheaper. Net exports subtracted from growth in the quarter, after boosting it the quarter before.

Consumer spending, however, has held up amid signs of trouble overseas and earlier volatility in stock markets. Spending grew at a relatively robust 3.2 percent pace, down only slightly from 3.6 percent the quarter before. Homebuilding also grew at above 6 percent, even after slowing from double-digit growth earlier in the year.

Thursday’s estimate of third-quarter is the first of three. The numbers in the report are subject to major changes.