US economy expands more than expected in fourth quarter

The US economy grew at an annualized rate of 3.3% during the fourth quarter of 2023, while outstripping market consensus of a 2% growth, preliminary data showed.

Consumer spending growth slowed (2.8% YoY versus 3.1% YoY in the third quarter), while consumption of services accelerated (2.4% YoY versus 2.2% YoY in Q3).

Government spending also increased at a slower rate in the fourth quarter (3.3% YoY versus 5.8% YoY in Q3).

Meanwhile, exports growth picked up (6.3% YoY versus 5.4% YoY in Q3), while imports growth slowed (1.9% YoY versus 4.2% YoY in Q3).

Non-residential investment growth accelerated in Q4 (1.9% YoY versus 1.4% YoY in Q3), driven by a rebound in equipment and a surge in intellectual property.

Residential investment growth continued in Q4, but at a slower rate, the data showed.

For the entire 2023, the US GDP rose 2.5% following a 1.9% growth in 2022 and compared with the Federal Reserve’s projection of 2.6%.