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| US economic growth slows despite consumers spending | |
| (32 minutes later) | |
| Economic growth in the US slowed at the end of last year, as trade and investment declined and the country was hit by hurricanes and labour strikes. | Economic growth in the US slowed at the end of last year, as trade and investment declined and the country was hit by hurricanes and labour strikes. |
| The economy expanded at an annual rate of 2.3% between October and December, down from 3.1% in the three months before, according to the US Commerce Department. | The economy expanded at an annual rate of 2.3% between October and December, down from 3.1% in the three months before, according to the US Commerce Department. |
| The pace, fuelled by solid growth in consumer spending, was nevertheless weaker than economists had forecast. | The pace, fuelled by solid growth in consumer spending, was nevertheless weaker than economists had forecast. |
| The figures come amid heightened uncertainty about the path for the world's largest economy, as US President Donald Trump calls for a policy shake-up. | The figures come amid heightened uncertainty about the path for the world's largest economy, as US President Donald Trump calls for a policy shake-up. |
| His plans include big cuts to government spending and implementing trade tariffs, which could be announced this week. | His plans include big cuts to government spending and implementing trade tariffs, which could be announced this week. |
| The US economy had been forecast to expand at roughly 2.5% in the final three months of 2024 though analysts said details of the Commerce Department report suggested growth remained solid. | The US economy had been forecast to expand at roughly 2.5% in the final three months of 2024 though analysts said details of the Commerce Department report suggested growth remained solid. |
| "The US consumer has been unstoppable, supported by wealth creation, a strong labor market, and lending," said Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management, adding that overall growth last year was "surprisingly strong". | "The US consumer has been unstoppable, supported by wealth creation, a strong labor market, and lending," said Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management, adding that overall growth last year was "surprisingly strong". |
| Consumer spending - the biggest driver of the US economy - rose 4.2%. This helped offset a drop in goods exports as well as a fall in private investment. | |
| Imports also declined. | |
| Analyst Samuel Tombs of Pantheon Macroeconomics noted that consumer spending was lifted primarily by a jump in purchases of goods, including cars. | Analyst Samuel Tombs of Pantheon Macroeconomics noted that consumer spending was lifted primarily by a jump in purchases of goods, including cars. |
| He said that could indicate a temporary burst of buying from people worried about the impact of potential tariffs on prices. | He said that could indicate a temporary burst of buying from people worried about the impact of potential tariffs on prices. |
| "We would caution against concluding that underlying domestic demand remains unassailably strong," he added. | "We would caution against concluding that underlying domestic demand remains unassailably strong," he added. |