The US economy grew at a slower pace in the fourth quarter, with the US Bureau of Economic Analysis (BEA) reporting GDP (gross domestic product) to have risen by 2.3%. This was below original forecasts of 2.6%. The US economy still managed to grow by a solid 2.8% annually in 2024.
HSBC chief US economist Ryan Wang appears on Market Domination to highlight that despite the GDP dip in the fourth quarter, the economy remains strong and is being driven by robust consumer spending and business investment.
The tariff, immigration, fiscal, and regulatory policies under the second Trump administration remain sources of uncertainty, Wang emphasizes, as the economy starts to show signs of positive momentum in early 2025.
"I think what we can say is that we're entering this year with the economy still on a pretty good footing," Wang says. "Yes, the headline GDP number for the fourth quarter was a little bit lower than expected. But, if you average the four quarters, 2.5%, still strong growth in consumer spending, pretty strong growth in business investment, although that rate of growth has decelerated a little bit."
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Regarding President Trump's tariffs, Wang points out that "both consumers and businesses are thinking" ahead. Wang stresses that while tariffs could influence some purchasing decisions, the primary driver remains the strength of the labor market.
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This post was written by Josh Lynch