US economy grew at solid 2.1% rate in fourth quarter

Economists expected the economy to expand by 2.1 percent in the fourth quarter

The U.S. economy maintained a steady pace of growth in the fourth quarter of last year, according to new data published Thursday morning.

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Gross domestic product, a measure of how much the U.S. produces in goods and services, grew at a 2.1 percent annualized rate during the three-month period from October through December, according to preliminary data published by Commerce Department. That matched the 2.1 percent growth rate in the third quarter.

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For the full year, the economy grew 2.3 percent, below the 2.9 increase from 2018 and the 2.4 percent gain in 2017, amid fading fiscal stimulus from President Trump's 2017 Tax Cuts and Jobs Act and an 18-month trade war between the U.S. and China that rattled global financial markets.

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Economists surveyed by Refinitiv expected the economy to expand by 2.1 percent.

"Today’s GDP report offers a bit of optimism and tells us that the economy still has plenty of fight left in it right now," Steve Rick, chief economist at CUNA Mutual Group, said.

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Consumer spending, which accounts for more than two-thirds of the country’s GDP, continued to boost the now $21.7 trillion economy. Still, it rose a modest 1.8 percent in the final months of 2019, sharply below the 3.2 percent increase in the third quarter.

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Net exports also contributed to growth, rising 1.4 percent in the fourth quarter. Imports fell 8.7 percent, caused by a drop in consumer goods and motor vehicles, as the U.S. has made strides to reduce its global trade imbalance. The U.S. and China recently signed a partial trade deal, easing tensions, though the trade war continued to impact businesses and investment.