US Gross Domestic Product (GDP), the value of every
thing and service created domestically, rose at a 2.6%
annualized rate in the fourth quarter.
This was weaker than the 3% growth rate that economists
had forecast, and that the Trump administration has set as a
Still, consumer spending, the biggest contributor to
growth, grew at its fastest pace in more than a
Growth was hindered most by a widened trade
The US economy grew slower than expected in the fourth quarter,
according to the Commerce Department’s first estimate of Gross
Domestic Product (GDP) released on Friday.
GDP, the value of everything produced domestically, rose at an
annualized rate of 2.6%. Economists had forecast 3% growth,
according to Bloomberg.
Growth in the second quarter was also revised lower, ruining what
would have been the longest streak of growth above 3% since
2005. President Donald Trump has touted 3% GDP as a
target for his administration, even as several polls of
economists show this may not be
Still, consumer spending, which is the biggest contributor to the
economy, grew at its fastest pace in more than a year, by 3.8%.
Growth was partly driven by a strong holiday shopping season;
Mastercard SpendingPulse showed that sales from November 1
through Christmas Eve rose 4.9% year-on-year, the strongest pace
Growth in the fourth quarter was hindered the most by a widened
trade deficit, as America exported less than it
The housing market also ended the year on a sound note, with the
data for December showing that
new residential construction rose to a 10-year high in
“The quarter overall witnessed the firmest annualized run rate in
control retail sales (ex. autos, gasoline, building materials)
since September 2003,” said Tom Porcelli, the chief Us economist
at RBC Capital Markets, in a preview. “It clocked in at a very
Friday’s initial print on the fourth quarter will be revised two
more times when the Commerce Department has more data.