The economy in the U.S. expanded at a slower pace in the fourth quarter than previously reported, restrained by a smaller gain in stockpiles and widening trade gap, even as consumers continued to provide support.
Gross domestic product, the value of all goods and services produced, rose at a 2.2% annualized rate, down from an initial estimate of 2.6%, U.S. Commerce Department figures showed Friday in Washington. A median forecast of 83 economists called for a 2% pace.
While overall growth was revised down, consumer spending last quarter climbed by the most in four years, underscoring the fundamental strength of the expansion. An improving job market and cheaper fuel costs will probably keep supporting households this year, which will help the U.S. overcome a slowdown in exports as the dollar climbs and foreign economies struggle.
Economists’ GDP projections ranged from 1.5% to 2.5%. This is the second of three estimates for the quarter, with the other release scheduled for March when more information can be incorporated.
For all of 2014, the U.S. economy grew 2.4% from the year before, following a 2.2% advance in 2013. Consumer spending rose 2.5%, the most since 2006.
Household consumption, which accounts for about 70% of the economy, grew at a 4.2% annualized rate in the fourth quarter, the most since the last three months of 2010. It was previously estimated at 4.3%. Purchases added 2.8 percentage points to growth.
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