The US economy was expected to grow at a breakneck pace in the third quarter

The U.S. economy is expected to grow at a breakneck pace in the three months ending in September, fueling optimism about the country’s prospects but making it more difficult to contain inflation.

Fresh GDP data due on Thursday is expected to bolster other recent indicators of a strong economy resisting Federal Reserve efforts to cool price increases by slowing.

The blockbuster jobs report released earlier this month nearly doubled economists’ expectations. Consumer spending, which accounts for nearly three-quarters of U.S. economic activity, rose in September, according to data released last week.

Economists expect GDP to grow at an annualized rate of 4.3% in the three months ending in September – almost twice as fast as in the previous quarter.

U.S. GDP grew at an annualized rate of 2.4% in the three months ended in June, an improvement over the pace recorded in the previous quarter.

Such solid indicators could prompt the Fed to raise interest rates at its meeting next week to combat persistently high inflation.

Speaking at a luncheon in New York last week, Fed Chairman Jerome Powell noted unexpectedly strong economic performance in recent months.

“We are wary of recent data showing the resilience of economic growth and labor demand,” Powell said, adding that such growth could “threaten further progress in inflation.”

Inflation is well below last year’s peak of over 9%, but progress has stalled in recent months and price growth remains more than a percentage point above the central bank’s target rate.

However, recent economic growth belies the alarm raised by one of the most important economic indicators: the 10-year Treasury yield.

A sharp rise in U.S. government bond yields in recent weeks has pushed up borrowing costs for consumers seeking mortgage loans and corporations seeking funds to expand their businesses.

The jump in loan spending threatens to slow economic activity in the coming months. Economists expect GDP growth to slow later this year.

The beginning of some financial trouble is visible in the housing market, where the average interest rate on a 30-year fixed-rate mortgage was 8% last week, according to Mortgage News Daily.

High mortgage rates have slowed the housing market dramatically as home buyers balk at the high cost of borrowing and home sellers choose to stick with mortgages that offer them relatively low interest rates.

Mortgage applications have fallen to their lowest level since 1996, the Mortgage Brokers Association reported earlier this month.

Last week, major housing industry groups expressed “deep concern” about rising mortgage rates in a letter urging the Federal Reserve to stop raising its benchmark interest rate.

Business leaders and policymakers will be watching closely when the Fed announces its latest decision to raise interest rates on November 1.

The central bank expects to raise interest rates again this year, according to projections in a statement last month from the Federal Open Market Committee, or FOMC, the Fed’s interest rate decision-making body.

The benchmark interest rate is currently between 5.25% and 5.5% following an almost historic series of rate increases, also known as credit tightening,

“Given the rapid pace of tightening, there could still be significant monetary tightening,” Powell said last week.