Newsroom
March 27, 2015
GDP growth steady at 2.2% for 4Q
The U.S. economy grew by 2.2 percent in the fourth quarter, according to the Commerce Department's third and final estimate, as revisions nudged consumption upward while estimates of inventory accumulation fell.
The Commerce Department's second estimate earlier this month was also 2.2 percent growth.
"Net exports were slightly less of a drag than previously estimated," said NAFCU Chief Economist and Director of Research Curt Long in a NAFCU Macro Data Flash report.
Core personal consumption expenditure inflation, the Fed's preferred inflation indicator, declined to 1.1 percent in the fourth quarter from 1.4 percent in the third quarter. Overall PCE inflation retreated by 0.4 percent in the fourth quarter, compared to a 1.2 percent gain the third quarter.
Consumer spending increased by 4.4 percent, residential investment increased 3.8 percent, nonresidential investment increased 4.7 percent and government spending decreased by 1.9 percent, according to the final estimate. Inventory accumulation fell from $82.2 billion in the third quarter to $80 billion in the fourth. Net exports fell from $-431.4 billion to $-471.4 billion from the third quarter to the fourth.
"Growth is expected to be strong in 2015, although first quarter output may be dampened by inclement weather," Long said. "Consumer spending should remain strong as lower energy costs free up households' disposable income and the labor market continues to improve.
"On that front, improvements to wage growth represent an upside risk," Long added. "Meanwhile, tightening in the housing industry should lead to increased construction later in the year. The main drag on growth this year will be net exports due to the strength of the dollar."
The Commerce Department's second estimate earlier this month was also 2.2 percent growth.
"Net exports were slightly less of a drag than previously estimated," said NAFCU Chief Economist and Director of Research Curt Long in a NAFCU Macro Data Flash report.
Core personal consumption expenditure inflation, the Fed's preferred inflation indicator, declined to 1.1 percent in the fourth quarter from 1.4 percent in the third quarter. Overall PCE inflation retreated by 0.4 percent in the fourth quarter, compared to a 1.2 percent gain the third quarter.
Consumer spending increased by 4.4 percent, residential investment increased 3.8 percent, nonresidential investment increased 4.7 percent and government spending decreased by 1.9 percent, according to the final estimate. Inventory accumulation fell from $82.2 billion in the third quarter to $80 billion in the fourth. Net exports fell from $-431.4 billion to $-471.4 billion from the third quarter to the fourth.
"Growth is expected to be strong in 2015, although first quarter output may be dampened by inclement weather," Long said. "Consumer spending should remain strong as lower energy costs free up households' disposable income and the labor market continues to improve.
"On that front, improvements to wage growth represent an upside risk," Long added. "Meanwhile, tightening in the housing industry should lead to increased construction later in the year. The main drag on growth this year will be net exports due to the strength of the dollar."
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