US GDP increased by 2.5% during 2023

US economic growth exceeds expectations in the fourth quarter While slowing inflation has boosted consumer spending, It capped off a surprisingly strong year that defied current recession expectations.

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GDP grew at an annual rate of 3.3%, according to the government's preliminary estimate published on Thursday. In all of 2023, the economy expanded by 2.5%.

The economy's main growth engine – personal spending – grew at a rate of 2.8%.

Investment in businesses and housing also helped drive the larger-than-expected advance in the final quarter of the year. A closely watched measure of core inflation rose 2%. According to the report of the Bureau of Economic Analysis in that country.

These figures conclude a year in which the economy showed surprising resilience, defying expectations Many Wall Street economists believed the country was on the verge of falling into recession.

(See: US GDP closes 2023 with 2.5% economic expansion.)

Despite the burden on families and companies from rising interest rates Federal Reserve (US central bank), consumer spending has been consistently boosted by durable job growth and slowing inflation.

The fourth-quarter numbers indicate this, driven by higher-than-expected holiday spending The economy has gained some momentum in the new year, Which fuels expectations that the expansion is on a more solid footing.

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Inflation development and response The Federal Reserve will be crucial in determining the direction of the economy this year.

Longer interest rates remain constrainedThe more economists expect that borrowing costs will affect demand, as well as hiring and expansion plans.

it is expected that Central bankers will hold interest rates next week At the highest level in two decades, although they have already begun to discuss easing monetary policy.

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Bloomberg