Data released by Bureau of Economic Analysis today showed that gross domestic product (GDP)—the widest measure of economic activity—grew at a 2.9 percent (annualized) rate in the third quarter of 2016. This is a welcome increase in headline growth numbers—the economy had grown just 1.3 percent over the last year, and at just 2.1 percent over the past two years.

But stripping out the volatile inventory components of GDP, one sees a more modest growth pick-up: final sales (GDP minus the contribution of inventories) had grown at a 1.8 percent annualized rate on average over the past year, and they grew by 2.3 percent in the third quarter. That this was only a modest pick-up in growth is highlighted by the trivially small increase in core price inflation in today’s report. Core consumer prices rose just 1.7 percent over the past year—still well below the Federal Reserve’s 2 percent target and up only 0.1 percent over the second quarter. This indicates the economy remains nowhere near overheating and causing an outbreak of too-fast inflation

While today’s data is a mildly encouraging sign that a modest growth pick-up has begun, policymakers should certainly not get complacent—we need several quarters with growth rates this high before the economy will be fully healthy again.