Gross domestic product increased by 7% in the fourth quarter | Economy
The U.S. economy grew at an annual rate of 7% in the fourth quarter, the Bureau of Economic Analysis reported Thursday.
The country’s gross domestic product growth edged up slightly from the previous estimate of 6.9% and compares with 2.3% in the third quarter.
“The updated estimates reflected primarily upward revisions to nonresidential fixed investment, state and local government spending, and residential fixed investment that were partially offset by downward revisions to personal consumption spending” , says the report.
While the economy ended 2021 on a positive note, it is expected to cool significantly in 2022 as rising interest rates and the lack of effects from several rounds of fiscal stimulus during the coronavirus pandemic slow. consumer spending.
Economic political cartoons
The Federal Reserve has pledged to raise interest rates, most likely next month, to dampen rising inflation, which is running at an annual rate of 7.5%. Rising energy prices and persistent shortages of essential goods are also slowing spending.
Still, with economists predicting 3.5% growth in 2022, that would still be a level of activity above pre-pandemic levels.
Geopolitical tensions could upend those predictions, with Russian President Vladimir Putin launching an invasion of Ukraine on Wednesday night. Stock markets around the world sold off, with Dow Jones Industrial Average futures falling more than 800 points in premarket trading. And the price of oil jumped above $100 a barrel. Russia is a major oil and natural gas producer.
Separately, the Labor Department said initial jobless claims fell to 232,000 last week, down 17,000 from the revised level the previous week.
The four-week moving average, meanwhile, was at 236,250, down 7,250 from the previous level.