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Friday, February 27, 2015

Fourth Quarter Growth Down from Initial Estimate

U.S. Real GDP for the fourth quarter increased at a rate of 2.2%, noticeably lower than the initial estimate of 2.6% and substantially lower than the 5% growth achieved in quarter three.



Consumption contributed 2.8% to growth, up from 2.2% in the third quarter, yet GDP fell due to a decrease in net exports and a decline in government spending.



Rising dollar values and weak oil prices contributed to the decline in exports. Net exports provided a drag of 1.2% on fourth quarter growth compared to a 0.8% boost in the third quarter. Government spending decreased lowering growth by 0.3%, largely due to a reduction in national defense spending which decreased by 12.4% compared to an increase of 16% in quarter three.

For the year as a whole, GDP increased by 2.4 percent reflecting positive contributions from personal consumption expenditures, nonresidential fixed investment, exports, state and local government spending and private inventory investment.

Read the BEA release.

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