U.S. Economic Growth Slows More Than Expected In Q4
(RTTNews) - U.S. economic growth in the fourth quarter of 2024 fell short of economist estimates, according to a report released by the Commerce Department on Thursday.
The report said gross domestic product shot up by 2.3 percent in the fourth quarter after surging by 3.1 percent in the third quarter. Economists had expected GDP to jump by 2.6 percent.
The Commerce Department said the GDP growth in the fourth quarter primarily reflected increases in consumer spending and government spending that were partly offset by a decrease in investment.
Meanwhile, the report said the slowdown in the pace of GDP growth compared to the previous quarter primarily reflected downturns in investment and exports.
"Despite Q4 GDP growth surprising to the downside on the surface, the economy ended 2024 on a strong note," said FHN Financial Macro Strategist Will Compernolle. "Domestic demand is strong, inflation came in as expected, and a huge inventory drawdown is unlikely to sustain into upcoming quarters."
He added, "The Fed can look at this report and remain cautiously optimistic that inflation is not meaningfully accelerating, and growth is not falling below potential."
The Commerce Department said its reading on consumer prices surged by 2.3 percent in the fourth quarter after climbing by 1.5 percent in the third quarter.
Excluding food and energy prices, core consumer prices spiked by 2.5 percent in the fourth quarter compared with a 2.2 percent jump in the previous quarter.
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