U.S. economy grew 2.4% in the 4th quarter after upgrade in final growth estimate

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PAUL WISEMAN

Thu, Mar 27, 2025, 5:37 AM 2 min read

WASHINGTON (AP) — The U.S. system expanded astatine a steadfast yearly 2.4% gait the past 3 months of 2024, supported by a year-end surge successful user spending, the authorities said Thursday successful a flimsy upgrade of its erstwhile estimation of fourth-quarter growth.

But it’s unclear whether the United States tin prolong coagulated maturation arsenic President Donald Trump wages commercialized wars, purges the national workforce and promises wide deportations of immigrants moving successful the state illegally.

The Commerce Department said that maturation successful gross home merchandise — the nation’s output of goods and services — decelerated from a 3.1% gait successful July-September 2024.

For each of 2024, the system — the world’s biggest — grew 2.8%, down a tick from 2.9% successful 2023.

Consumer spending roseate astatine a 4% pace, up from 3.7% successful third-quarter 2023. But concern business fell, led by an 8.7% driblet successful concern successful equipment.

A driblet successful concern inventories shaved 0.84 percent points disconnected fourth-quarter GDP growth.

A class wrong the GDP information that measures the economy’s underlying spot roseate astatine a steadfast 2.9% yearly complaint successful the 4th quarter, slipping from the government's erstwhile estimation of 3.2% and from 3.4% successful the 3rd quarter. This class includes user spending and backstage concern but excludes volatile items similar exports, inventories and authorities spending.

Wednesday’s study showed continued inflationary unit astatine the extremity of 2024. The Federal Reserve’s favored ostentation gauge – the idiosyncratic depletion expenditures, oregon PCE, terms scale – roseate astatine an yearly complaint of 2.4%, up from 1.5% successful the 3rd 4th and supra the Federal Reserve’s 2% target. Excluding volatile nutrient and vigor prices, alleged halfway PC ostentation registered 2.6%, compared to 2.2% successful the 3rd quarter.

Thursday's study was the government's 3rd and last look astatine fourth-quarter GDP.

The outlook is cloudier. Trump's determination to slap taxes connected a scope of imports — including a 25% taxation connected overseas autos announced Wednesday — could propulsion up ostentation and disrupt investment, hurting growth.