Picture: Jeff Kowalsky/AFP through Getty Pictures
The U.S. economic system grew at an annualized 2.9% charge within the ultimate months of 2022, the Commerce Division stated on Thursday.
Why it issues: Economists are bracing for a big slowdown in financial exercise because the Federal Reserve’s rates of interest hikes take maintain, however that definitely wasn’t the case within the ultimate months of final yr.
- Economists anticipated the Gross Home Product figures to indicate the economic system grew at a 2.6% annualized charge final quarter, after increasing at a 3.2% tempo within the prior quarter.
Particulars: Client spending and companies constructed up non-public inventories gave GDP the most important enhance. Among the many largest drags: mounted funding, a class that features housing.
By the numbers: Over the calendar yr, GDP grew by 2.1% in 2022 — a good tempo, particularly contemplating the traditionally aggressive charge hikes by the Federal Reserve that sought to restrain financial exercise to include inflation.
- These charge hikes hit the housing sector significantly arduous, which dragged down total development earlier final yr.
Catch up fast: The primary half of 2022 was dogged by fears that the economic system had entered a recession, after back-to-back quarters of contractions. However by the second half of the yr, the economic system had returned to development mode.
- The expansion over 2022 was an anticipated slowdown from the 5.9% achieved in 2021, when the economic system bounced again from the pandemic shock.
