The U.S. economy grew at an annual rate of 3.5 percent in the third quarter this year, down from 4.2 percent in the previous quarter, the U.S. Commerce Department reported on Friday.

Personal consumption expenditures, which account for more than two thirds of the overall economy, grew at an annual rate of 4 percent in the third quarter, up from 3.8 percent in the second quarter, according to the department.

But non-residential fixed investment, a measure of corporate spending on structures and equipment, increased only 0.8 percent in the third quarter after rising 8.7 percent in the previous three months.

While U.S. exports declined 3.5 percent in the third quarter, imports rose 9.1 percent as American importers stepped up purchases of foreign goods. The widening trade gap subtracted about 1.78 percentage points from GDP growth in the third quarter.