At the same time, government spending spurred growth for the first time in nine quarters, the report showed.
The biggest contributor was a jump in defense spending, which expanded at a 13 percent annual rate. Analysts pointed out that defense expenditures often rise just before the end of the fiscal year in September and would likely prove unsustainable.
Non-defense federal spending rose at only a 3 percent annual pace.
State and local government spending, which has been contracting continuously since the start of 2010, was essentially flat in the past quarter. Coupled with a recent slowdown in layoffs in that sector, the report indicates that the biggest cuts in state and local governments could be over, at least for now.
Despite those gains, other parts of the economy slowed in the past quarter.
Exports fell at a 1.6 percent annual rate after rising every quarter for more than three years. The slowing global economy, particularly in Europe and China, was a major factor in the trade slowdown.
Imports were also down, but not as much. Overall, the trade imbalance subtracted more than 0.18 percentage point from overall economic growth.
In another worrisome sign, businesses seem to be holding onto cash and pulling back on capital investment, perhaps out of fear of the slowing global economy and the prospect of the “fiscal cliff” — tax hikes and automatic spending cuts that will take place next year unless Washington acts to head them off.
Business investment in buildings, factories and other structures fell at a 4.4 percent annual rate, while purchases of equipment and software were flat after having risen for 11 consecutive quarters. That result is consistent with Thursday’s weak report on orders of durable goods such as machinery.
“The recovery continues, but at an agonizingly slow pace,” said Bernard Baumohl, chief global economist of the Economic Outlook Group.
Health-care spending was also down for a second consecutive quarter. The only prior periods in which real spending in that sector declined in consecutive quarters were from the third quarter of 2009 to the first quarter of 2010 and in the 1981-82 recession, according to Dean Baker, co-director of the Center for Economic and Policy Research.
“Nominal health-care spending increased at just a 0.5 percent annual rate, the slowest growth since 1965,” Baker wrote. “While the weakness of the economy is almost certainly a factor in slowing growth, it is likely that we are seeing evidence of a slower growth path for spending. The implications of this for the economy and the budget debates will be enormous.”
Neil Irwin contributed to this report.