Revised GNP Figures Show 3% Growth : Economy: The Commerce Department says an improved trade picture boosted third-quarter results.

The U.S. economy grew at a revised 3% rate in the third quarter, stronger than previously estimated due to an improved trade picture, the Commerce Department said Wednesday.

The department, revising its growth estimate for the second and final time, had initially reported that third-quarter Gross National Product grew at a 2.5% rate. It then revised it to a 2.7% gain before pushing it up once again.

The department said a cut in the nation’s trade deficit accounted for the higher rate of economic growth.

The final GNP estimate exceeded expectations of a 2.7% rate of economic expansion.

But economists said the data offered little new information to shape their view of the economic landscape.

“In terms of the underlying economy, the fourth quarter is going to be weak, but I don’t think this report will have much impact on those numbers,” said Bruce Steinberg at Merrill Lynch. “By now, most everything is known about the third quarter and this report is simply fine-tuning,” he added.

The rise in GNP was supported by a downward revision in the trade deficit to $57.1 billion. This was $6.5 billion less than previously estimated but still higher than the second-quarter trade gap of $51.2 billion.

Since the department’s initial third-quarter GNP report in late October, the estimate of the trade deficit has been cut by $17 billion--or a whopping 23%--leading to the upward revision in growth.

Despite stronger growth in the July to September period, economists said fourth-quarter growth has dropped dramatically and may actually contract after seven years of uninterrupted expansion.

Manufacturing employment has declined for the past several months, industrial production has dipped, residential building has fallen and consumer spending has declined.

The sluggish economy also took a hit from Hurricane Hugo and the San Francisco earthquake in the fall.

The Bush Administration is forecasting a 2.7% growth rate for all of 1989, and the fourth-quarter GNP would have to advance 1.6% to meet that goal. The GNP grew by 3.7% in the first quarter and 2.5% in the second.

“The bottom line is that we borrowed from the future to produce 3% growth and that source of strength is gone now,” said Allen Sinai, chief economist for the Boston Co.

Sinai and others said much of the third-quarter growth resulted from robust earlier-than-normal sales of automobiles and light trucks that were driven by incentives.

But the incentives were dropped with the introduction of higher-priced 1990 models in October and sales immediately slumped. Only this month have auto makers begun to restore rebates and lower interest rates that chief economist David Berson of the Federal National Mortgage Assn. said could boost sales early next year.

In another sign of slower economic growth, the department said business investment also eased, growing at a 5.2% annual rate in the third quarter compared to an 8.6% rate in the second quarter.

The implicit price deflator, a gauge of inflation that measures price changes in the GNP report, remained unchanged from the previous estimate of a 3.2% annual rate.

The department revised down consumer spending to a 5.6% growth rate in the third quarter, compared to a previous estimate of 6.2%.