Growth in the United States eased during the third quarter according to the second GDP estimate released today, as seemingly rising job losses and tightened credit conditions continue to weigh down on economic activity in the world’s largest economy, despite that the U.S. government contributed to growth through fiscal stimulus, which indeed helped the economy to expand after contracting over the past few quarters.

The U.S. economy grew by 2.8% in the third quarter according to the second GDP estimate released today from the U.S. Commerce Department, the GDP estimate was revised lower from the prior advanced estimate of 3.5% and inline with median estimates, though personal consumption was revised lower to 2.9% from 3.4% and below median estimates of 3.2%.

Moreover, the GDP Price index rose in the third quarter by 0.5% a downward revision from the prior reported estimate of 0.8%, while core PCE rose by 1.3% in the third quarter also revised lower from the prior reported rise of 1.4%.

Gross private investments were revised lower during the third quarter top 8.4% from 11.5%, while exports rose by 17.0% an upward revision from 14.7%, and imports also increased in the third quarter after being revised higher to 20.8% from 16.4% reported in the Advanced GDP estimate for the third quarter.

The downward revision in personal consumption meant that personal spending contributed by 2.07% to GDP down from the prior estimate of 2.36%, while investments added 0.91% to GDP also down from 1.22% in the Advanced estimate, where the housing sector added 0.45% to GDP, inventories added 0.87% to GDP, while net exports shed 0.83% from GDP, and finally governmental consumption added 0.63% to GDP.

Growth in the United States will probably ease during the upcoming few quarters, as the U.S. economy was able to grow over such a substantial rate due to the ongoing governmental help through the fiscal stimulus, which is reported to have saved or created at least 300,000 jobs over the past period, while the recent improvement in economic conditions played its part though the bigger weight was mainly due to the government’s increased spending.

Unemployment rose in October to the highest level since 1983, as unemployment surged to 10.2% and it’s still expected to rise further over the upcoming few months, which means that the U.S. economy will probably remain under pressure, since income growth will be negatively affected and accordingly consumer spending will remain under pressure, noting that consumer spending accounts for nearly 2/3 of economic activity in the United States.

Though the U.S. economy has been showing recently signs of improvement, however, we are still not out of the woods yet, as the aftermath of the worst recession since WWII still exist and accordingly we should expect economic activity to remain under pressure over the upcoming period, as the recovery is still expected to be gradual and rather slow.

The U.S. economy is yet to return back to its long term growth potentials, where the recovery process is well expected to continue through next year, before the economy can meet its long term growth potentials during 2011 probably, yet it’s almost sure for now that job losses will continue to weigh down on activity at least during this year and probably into the first half of 2010 as well.

Meanwhile, the housing market continues to show more signs of stabilization, as yesterday the existing home sales signaled that sales of previously owned houses rose in October, while today the S&P/CS Composite- 20 index which measures prices in 20 metropolitan areas in the United States signaled that, prices dropped compared with a year earlier by 9.36% in September, while the S&P/CS house price index declined by 8.86% during the third quarter compared with the prior revised drop of 14.74%.

Activity in the housing market is still showing signs of stabilization, as so far the housing sector was able to rebound from its worst slump since the Great Depression, yet activity is still somehow weak, as rising unemployment, tightened credit conditions, and rising foreclosures continue to weigh down on activity in the housing market, and we should expect the housing market to take some time before it can regain its health and starts to prosper once again.