US economic system grows at 2.3% annualized tempo in fourth quarter, matching estimates

The US economic system grew at an unrevised 2.3% annualized tempo final quarter, on par with consensus estimates.

The Bureau of Financial Evaluation’s second estimate of fourth quarter US gross home product (GDP) was unchanged from the superior estimate, which had proven 2.3% annualized progress.

The second estimate, primarily based on extra full supply knowledge than the superior estimate, means that financial progress within the fourth quarter was slower than the three.1% annualized progress seen within the third quarter.

The rise in actual GDP within the fourth quarter primarily mirrored will increase in shopper spending and authorities spending that had been partly offset by a lower in funding, based on the BEA.

A 3rd and closing estimate for This fall GDP progress will likely be launched on the finish of March.

The expansion replace comes on the heels of higher issues that President Trump’s tariff plans will harm the US economic system and result in slower progress and better inflation over time.

In line with knowledge launched earlier this week, shopper confidence plummeted in February, notching its largest month-to-month decline in almost 4 years as 12-month inflation expectations jumped and recession fears escalated.

The newest shopper sentiment knowledge additionally highlighted fears round tariffs and the influence these and different Trump 2.0 insurance policies, like immigration curbs and DOGE layoffs, might have on the broader economic system.

“The quick coverage modifications from the brand new administration (immigration enforcement and tariffs) are more likely to weigh on progress whereas offering little aid on inflation,” Morgan Stanley analyst Mike Wilson wrote in a observe to shoppers on Monday.

Wednesday’s GDP studying is taken into account backward-looking, provided that it gives an replace on financial progress for the quarter that resulted in December.

Projections present the economic system rising at a gradual tempo within the present quarter, which ends in March. The Atlanta Fed GDPNow tracker at the moment initiatives the US economic system is pacing for annualized progress of two.3%.

Individually, knowledge from the US Labor Division launched Thursday confirmed 242,000 unemployment claims had been filed within the week ending Feb. 22, forward of Wall Road’s expectations for 221,000 and a rise of twenty-two,000 from the earlier week’s revised degree.

There was additionally a notable enhance in DC jobless claims with 2,047 claims filed final week versus 1,626 within the prior-week interval. Total, although, federal jobless claims didn’t present any apparent influence of DOGE-related layoffs, with economists warning the timing remains to be early.

Persevering with weekly unemployment insurance coverage claims additionally continued to hover at excessive ranges, highlighting the continuing problem for staff to discover a new job. Persevering with claims throughout the week ending Feb. 15 ticked down barely to 1.86 million, a lower of 5,000 from the earlier week’s revised degree and under Wall Road expectations.

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