WASHINGTON (Reuters) – US economic growth slowed less than previously estimated in the fourth quarter as the biggest gain in consumer spending in three years partially offset the drag from a jump in imports.
Gross domestic product expanded at a 2.9 percent annual rate in the final three months of 2017, instead of the previously reported 2.5 percent, the Commerce Department said in its third GDP estimate for the period on Wednesday. That was a slight moderation from the third quarter’s brisk 3.2 percent pace.
The upward revision to the fourth-quarter growth estimate also reflected less inventory reduction than previously reported. Economists polled by Reuters had expected that fourth-quarter GDP growth would be revised up to a 2.7 percent rate.
There are signs that economic activity slowed further in the first quarter, with retail sales falling in February for a third straight month. Housing data have been generally weak and the trade deficit hit a more than nine-year high in January.
Estimates of the first-quarter GDP growth rate are currently just below 2.0 percent. Still, analysts believe the economy will hit the Trump administration’s 3 percent annual growth target this year, driven by a $1.5 trillion income tax cut package and a planned increase in government spending.
