The U.S. economy expanded at a much better than anticipated pace to close out 2021 from significant boosts in inventories and consumer spending.
Source: U.S. Department of Commerce
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Gross domestic product, which measures the value of all goods and services produced during the October-December period, rose at a 6.9% annualized rate, surpassing the expected gain of 5.5% by the Dow Jones economists.
The expansion was well above the unrevised 2.3% gain in Q3 and came as the surge in the Omicron variant that likely slowed hiring and output as businesses struggled with a large number of sick employees.
Gains were largely attributable to increases in private inventory investment improved consumer activity as a signaled in personal consumption expenditures, exports, and business spending.
A fall in the rate of government spending subtracted from GDP like in imports contributed to slowing output levels.
The quarter closing 2021 saw a 5.7% expansion in annualized GDP, the strongest rate since 1984 as the United States moved away from the unprecedented fall in activity.