United States real GDP rose by more than expected in the September quarter, but the result points more toward soft domestic demand rather than a sign of recovery. Growth is expected to slow next quarter and the Federal Reserve is unlikely to taper until 2014. In the United States, real GDP rose by 0.7 per cent in the September quarter, to be 1.6 per cent higher over the year. The result was above expectations, but this was mostly due to a stockpiling of private inventories, which is typically a sign of insufficient demand. The big concern for the December quarter is that businesses will cut back on production and run down their inventories, while at the same time government expenditure declines following the federal government shutdown. Excluding inventories, real GDP growth was in line with market expectations. Real GDP continues to grow at a fairly moderate pace but at this point of the recovery growth could and should be higher.