Real GDP grew 2.8% between the third and fourth quarters of last year, according to recent government estimates. Though an improvement over the 1.8% expansion between the second and third quarters, it was on the low side of what many economy-watchers had expected.
The gain in fourth quarter GDP was helped by an increase in private inventory investment and accelerations in consumer spending and residential real estate investment. Offsetting these gains were a deceleration in commercial real fixed investment, drops in government spending, and an increase in imports. Consumer spending grew by 2%, helped by a 15% increase in durable goods spending.
The results underscore the fact that although the US economy is technically in a recovery, it’s a slow and fragile one.
