The Q4 advance GDP estimate shows that growth has slowed down more than anticipated at the end 2024. However, annual growth is still at a healthy rate.
Bureau of Economic Analysis reports that the US economy will grow by 2,8% in 2024. This is a slight decrease from 20,23 when it grew 2.9%. The accepted threshold is 2% for countries that are developed.
The inflation-adjusted Gross Domestic Product (GDP) for 2024’s final months was 2.3%. This is lower than the projection of 2.4%. Adjusted Q3 GDP grew at 3.1%.
In Q4, personal expenditure was again up, at an annualized rate of 4.2%. The report shows that consumers spent most money on recreational and healthcare goods, as well as vehicles and recreation products.
Some argue that the increase in spending may be a sign of consumer resilience but is actually a result of rising prices.
These figures follow the FOMC’s latest decision to keep interest rates at the same level. Powell took a more doveish position yesterday, repeating that central banks are not in a hurry to reduce rates.
Powell said that the looming policies of tariffs also contributed to economic insecurity. Forecasting is difficult because of the uncertainty surrounding duration, size, target nations, and consumer impact.
BEA statistics showed that imports fell slightly during the fourth quarter. The GDP was also reduced by falling inventories. As Trump’s new tariffs begin to take shape, both figures will be important.
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