The US economy grew at a faster rate than expected in the fourth quarter, capping off a year many expected to end in recession with one final economic surprise.
The Bureau of Economic Analysis’s advance estimate of fourth quarter US gross domestic product (GDP) showed the economy grew at an annualized pace of 3.3% during the period, faster than consensus forecasts. Economists surveyed by Bloomberg estimated the US economy grew at an annualized pace of 2% during the period.
The reading came in lower than third quarter GDP, which was revised down to 4.9%. For the year, the US economy grew at an annualized rate of 2.5% up from 1.9% in 2022.
The GDP release highlights the resilience of the US consumer despite ongoing concerns of a slowdown. It’s the latest in a string of economic data releases that show the US economy ended 2023 on solid ground as investors closely watch to see if Fed can achieve its vaunted “soft landing,” where inflation returns to the 2% goal without a severe economic downturn.
Economic output hit its highest levels in seven months in January, according to the latest S&P Flash PMI release. A recent reading on consumer spending came in higher than expected with December’s retail sales number. And the labor market hasn’t shown severe signs of cooling off, with the latest reading of weekly jobless claims hitting its lowest level since September 2022.
Josh Schafer is a reporter for Yahoo Finance.
Click here for the latest economic news and economic indicators to help you in your investing decisions
Read the latest financial and business news from Yahoo Finance