Figures from the commerce Department show that between July and September, the US economy has shrunk at an annualized rate of 0.3%.

Though they showed the sharpest contraction of the economy since 2001, the gross domestic product (GDP) figures were better than expected. On the other hand, consumer spending that constitutes two-thirds of the US economy saw 3.1% shrinkage and it was the first contraction since 1991. This 0.3% shrinkage followed 2.8% growth during the last three-month period.

The figures related to shrinkage suggest that the US economy is halfway to the standard definition of a recession that shows two successive quarters of negative growth.

However, in the US the official definition is different and according to this definition the US economy is not officially in recession if the National Bureau of Economic Research doesn’t decide it.

But the Federal Reserve has shown concerns about recession and reduces its key interest rate from 1.5% to 1%. Bill Walsh, who is president of Hennnion and Walsh in New Jersey, said: “Consumer spending constitutes about 70% of GDP and it has been observed the lowest in two decades.”

The GDP figures along with Labor Department figures showed the number of new claims for jobless benefits last week.