Categories: Retirement Planning and Investing

Fourth-Quarter U.S. GDP Growth Cut to 2.4 Percent

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Fourth-Quarter U.S. GDP Growth Cut to 2.4 Percent (Reuters)

The U.S. government slashed its estimate for fourth-quarter growth as consumer spending and exports fell below initially estimates, suggesting a loss of economic momentum heading into 2014. Gross domestic product (GDP) expanded at a 2.4 percent annual rate, the Commerce Department reported on Friday. That marked a sharp drop from the 3.2 percent pace reported last month and the 4.1 percent logged in the third quarter. Economists polled by Reuters had expected growth would be cut to a 2.5 percent pace. It is not unusual for the government to make revisions to GDP numbers, as it does not have complete data when it makes its initial estimates. In fact, the latest figures will be subject to revisions next month as more information is received. The revision left GDP just above the economy’s potential growth trend, which analysts put somewhere between 2 percent and 2.3 percent. Even with the revision, the second-half growth pace hit 3.3 percent and jumped from 1.8 percent in the first six months of 2013. Consumer spending accounted for a large chunk of the revision, after retail sales in November and December came in weaker than assumed.

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Paul Dykewicz

Paul Dykewicz is the editor of StockInvestor.com and the editorial director of Eagle Financial Publications in Washington, D.C. He writes and edits for the website, as well as edits investment newsletters, time-sensitive trading alerts and other reports published by Eagle. He also is an accomplished, award-winning journalist who has written for Dow Jones, USA Today and other publications, as well as served as business editor of a daily newspaper in Baltimore. In addition, Paul is the author of the inspirational book, "Holy Smokes! Golden Guidance from Notre Dame's Championship Chaplain." He received his MBA in finance from Johns Hopkins University, where he was a two-time president of the school's Finance Club. In addition, Paul has a bachelor's degree from the University of Michigan and a master's degree in journalism from Michigan State University. Outside of work, Paul volunteers with a faith-based organization to assist the poor in Southeast Washington, D.C., to learn personal finance skills to lift themselves out of debt.