U.S. economy seen growing 1.2 percent in third quarter: Atlanta Fed

Assembly workers work on the underside of 2015 Ford Mustang vehicles on the production line at the Ford Motor Flat Rock Assembly Plant in Flat Rock, Michigan, August 20, 2015. REUTERS/Rebecca Cook·Reuters· (Reuters)
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NEW YORK (Reuters) - The U.S. economy is on track to grow 1.2 percent in the third quarter on data showing a decline in consumer spending on services in July, the Atlanta Federal Reserve's GDPNow forecast model showed on Friday.

This was weaker than the regional Fed bank's prior estimate on Wednesday of a 1.4 percent rise in gross domestic product, the Atlanta Fed said on its website.

The Atlanta Fed said the weakness in real services consumption last month reduced its estimate on personal consumption expenditures to a 2.6 percent increase for the current quarter from an earlier 3.1 percent gain.

The Commerce Department said on Friday personal spending grew 0.3 percent in July, matching June's upwardly revised increase. Analysts polled by Reuters had forecast a 0.4 percent gain.

(Reporting by Richard Leong; Editing by Chizu Nomiyama)

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