U.S. economic growth in the fourth quarter continued at the same pace as in the previous quarter, according to a report released by the Commerce Department on Thursday.
The Commerce Department said real gross domestic product climbed by 2.1 percent in the fourth quarter, unchanged from the third quarter and in line with economist estimates.
The fourth quarter GDP growth reflected positive contributions from consumer spending, government spending, residential fixed investment, and exports as well as a decrease in imports, which are a subtraction in the calculation of GDP.
Meanwhile, negative contributions from private inventory investment and non-residential fixed investment limited the upside.
The pace of GDP growth was unchanged from the previous quarter even though consumer spending growth slowed to 1.8 percent in the fourth quarter from 3.2 percent in the third quarter.
Private inventory investment also showed a larger decrease, but the negatives were offset by the downturn in imports, an acceleration in government spending, and a smaller decrease in non-residential investment.
“The 2.1% annualized gain in fourth-quarter GDP growth was not quite as solid as it looks, with consumption growth slowing and business investment contracting for a third consecutive quarter,” said Paul Ashworth, Chief U.S. Economist at Capital Economics.
He added, “Nevertheless, with the survey evidence beginning to improve slightly, and the Phase One trade deal easing one of the headwinds holding back investment, we expect GDP growth to gradually accelerate this year.”
The report also showed the annual rate of core consumer price growth slowed to just 1.3 percent in the fourth quarter from 2.1 percent in the third quarter.