The United States’ economic growth in the fourth quarter of last year was unexpectedly revised up, according to government figures released on Thursday, aided by stronger estimates of consumer spending and investment.
According to the Commerce Department’s most recent report, GDP growth in the world’s largest economy is expected to average 3.4 percent a year in the final three months of 2023.
The figure exceeded both the initial and second estimates of 3.3% and 3.2%, respectively.
“The update primarily reflected upward revisions to consumer spending and nonresidential fixed investment,” the Commerce Department stated.
However, this was “partly offset by a downward revision to private inventory investment,” the report stated.
Full-year growth remained at 2.5 percent.
Analysts had expected GDP projections to remain constant at 3.2 percent, but the number outperformed expectations.
Although experts projected that consumer spending would fall as households depleted their savings from the pandemic and borrowing costs remained high, consumption remained resilient last year.
The US economy also defied predictions of a recession, fueling hope that it is on track for a “soft landing” in which inflation falls without triggering a devastating recession.