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Investing.com - The U.S. economy grew by 2.3% in the fourth quarter, slowing from the prior three-month period, although other signs of resilient consumer demand could keep the Federal Reserve on track to carefully approach future potential interest rate cuts this year.
Gross domestic product in the final three months of 2024 eased at an annualized rate from a pace of 3.1% in the July-September quarter, according to advance data from the Commerce Department on Thursday.
Economists had expected the reading to decelerate to 2.7%.
The figure comes hours after the Federal Reserve chose to leave interest rates unchanged at a range of 4.25% to 4.5%, citing in part solid economic indicators. The jobs market has remained resilient, a trend which has combined with income increases to bolster consumer expenditures.
In a note to clients, analysts at Capital Economics flagged that the growth rate of final sales to private domestic purchasers in the fourth quarter "dropped off only marginally", from 3.4% to 3.2%.
The number is "suggests the economy remains strong," particularly given the fourth-quarter disruptions from a prolonged strike at planemaker Boeing (NYSE:BA) and devastating hurricanes, the analysts said.
But officials at the central bank have still been eyeing wider uncertainty around the outlook for the world's largest economy, especially the potential impact of a host of policy changes under the new administration of U.S. President Donald Trump.
Along with an uptick in deportations, Trump has threatened to slap import tariffs on America's friends and adversaries alike. Some economists have argued that these moves could refuel price pressures, and further slow the pace of possible Fed rate cuts in 2025.
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