Strong US consumer spending prompts upward revision to Q4 GDP
By Benjamin Chiou
Date: Thursday 28 Mar 2024
(Sharecast News) - Revisions to fourth-quarter GDP figures showed that the US economy grew at a faster-than-expected rate at the end of 2023, according to data out on Thursday from the Bureau of Economic Analysis.
US GDP expanded at an annual rate of 3.4% in the fourth quarter, following the 4.9% year-on-year growth seen in the third quarter.
This was revised up from an earlier estimate of 3.2% and ahead of the consensus forecast for no change from the initial reading.
The upward revisions were a result of higher-than-expected consumer spending and non-residential fixed investment that were partly offset by a downward revision to private inventory investment.
Economist Ryan Sweet from Oxford Economics said there was "plenty to like" from Thursday's release, even if it doesn't change short-term projections for the economy much.
"The new data don't significantly alter our near-term outlook for the economy [...] as GDP is backward looking. Also, the policy implications are minimal and we're still leaning toward pushing our expected timing of the first rate cut to June from May."
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