WASHINGTON (Reuters) - The U.S. economy's return to growth in the third quarter was less brisk than previously thought as the trade deficit worsened and companies still aggressively cut inventories, a Reuters survey predicted.
The poll of 66 economists forecast real gross domestic product growth would be revised down to an annualized rate of 2.9 percent from the 3.5 percent pace reported by the government last month.
It will still be the first expansion after four quarters of decline. Recent data, ranging from the trade balance to business inventories, have suggested the government's initial estimates on output were a bit on the optimistic side.
"Among the components, we look for the revisions to show a wider trade deficit, a bigger decline in nonresidential structures investment, slightly softer consumer spending growth, and a bigger contraction in inventories," wrote economists at Barclays Capital.
"Despite the likely downward revision, we still believe that the third quarter will prove to be the first quarter of recovery and that it demonstrates a decisive turn in the economy."
The U.S. trade deficit widened to $36.5 billion in September from $30.8 billion the previous month. Both exports and imports recorded their best month since December 2008.
The Commerce Department will release its second estimate of third-quarter GDP on Tuesday. The revisions have already been priced by the market and are unlikely to generate too much interest in a holiday-shortened trading week.
However, traders will keep on eye on the advance estimates on corporate profits to be released together with the GDP report. Aggressive cost cutting, mostly head count reduction, has seen companies reporting strong earnings.
The survey forecast after tax corporate profits surging 6.2 percent in the third quarter after rising 0.9 percent in the April-June period.
(Reporting by Lucia Mutikani; Editing by Kenneth Barry)