U.S. Fourth-quarter GDP Trimmed To 2.2% From 2.6%
The U.S. economy grew a revised 2.2% in the final three months of 2014, mostly because companies restocked warehouse shelves at a slower pace than the government originally reported. Gross domestic product was marked down from an original estimate of 2.6%. The value of inventories, which adds to GDP, increased by $88.4 billion in the fourth quarter instead of $113.1 billion, the Commerce Department said Friday. A slight larger trade gap also contributed to the downward revision in GDP. Export growth was raised to 3.2% from 2.8%, but the increase in imports was revised up to 10.1% from 8.9%. Consumer spending, on the other hand, was still quite strong, up 4.2% in the quarter. That was the biggest increase since 2010. Inflation as measured by the PCE index, meanwhile, fell at a 0.4% annual pace in the fourth quarter, while the core rate that excludes food and energy increased at a 1.1% rate. For all of 2014, the U.S. economy grew at a 2.4% clip, compared to 2.2% in 2013 and 2.3% in 2012.
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