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US gross domestic product slows to 2.6% in Q4

January 30, 2015

US real gross domestic product rose at an annual rate of 2.6% in the fourth quarter, according to an advance estimate released by the US Bureau of Economic Analysis. In the third quarter, real GDP rose by 5.0%.

The GDP estimate is slightly below consensus, but closer to the economy’s long-term trend growth rate of about 2.0 percent, according to The Conference Board.

“The current pace of economic growth is likely to sustain strong job growth in the coming months and further reduce the unemployment rate,” The Conference Board stated. “The Employment Cost Index, released today as well, showed ongoing acceleration in wage growth, with wages in the private sector moving up to 2.3 percent year on year. Further acceleration is to be expected. The acceleration in wage growth increases the likelihood of an increase in Fed interest rate by mid-2015.”

Economists polled by MarketWatch forecast GDP would grow by a seasonally adjusted 3.2% in the October-to-December period.