The economy grew at a 2.9 percent annual rate to end 2017, the Bureau of Economic Analysis reported Wednesday in its final update to its estimate of Gross Domestic Product.
That figure was revised up from 2.5 percent in the second estimate of GDP, thanks to better consumer spending and higher business investment in inventories than initially reported.
Wednesday’s news means that growth will fall just short of President Trump’s 3 percent goal for inflation-adjusted GDP. He touted the quarterly figures when they exceeded the 3 percent mark in the second and third quarters.
Also, it means that total growth for 2017 was 2.3 percent.
Meanwhile, the headline rate of 2.9 percent third quarter growth might have overstated the economy’s strength. Gross domestic income growth stood at just a 0.9 percent rate in the quarter, according to Wednesday’s release. In theory, income and output should be the same, but because of mismeasurement they often differ.
Still, fourth-quarter growth was encouraging for an economy nearing a 10th year of recovery. “The economy continues to motor on at least through the end of last year with more growth on the way later in 2018 if those historic corporate and individual tax cuts get put to work shortly,” noted Chris Rupkey, chief financial economist for UFG.
Federal Reserve officials projected last week that growth would clock in at 2.4 percent for 2018, as some of the “headwinds” that previously faced the economy, such as weak growth overseas, turn to “tailwinds.”
