The numbers: The US economy expanded in the fourth quarter at a revised annual rate of 4.3%, a touch higher than previously reported, and even faster growth is expected in the coming months.
Gross domestic product rose from the previous reading of 4.1% mainly due to somewhat higher business investment, the government’s revised figures show.
The economy appears to be picking up speed again after slowing towards the end of the year following a record coronavirus outbreak. Economists polled by Dow Jones and The Wall Street Journal predict that GDP will increase at a rate of 4.9% in the spring and 7% in the summer.
GDP is the sum of all goods and services produced by the economy and is a kind of scorecard for US performance.
The Bureau of Economic Analysis updates the GDP report twice after its initial release as more timely information becomes available to give a more complete picture of the economy’s performance.
Read: The US economy accelerates in March, and it’s not about to slow down
What happened: The biggest change in the fourth quarter GDP report was in business investment. Investment in inventories, intellectual property and residential housing was slightly higher than previously reported.
Exports also increased by a revised 22.3% from the previous reading of 21.8%. And state and local spending was not as weak as previously reported.
The increase in consumer spending, by far the largest contributor to the GDP report, fell a tick to 2.3% from 2.4%.
Most of the other numbers gained in the report changed little.
The panorama: The economy is picking up speed again due to declining coronavirus cases, increased vaccines, and warmer weather. A huge $ 1.9 trillion federal stimulus will give the economy an additional push forward.
The biggest question is whether the coronavirus will continue to disappear.
Another potential thorn is rising inflation. The recovery has spawned a spate of price increases on many key supplies, a problem exacerbated by growing shortages of key materials ranging from wood to computer chips.
Read: Economists say inflation is the biggest risk in two decades and could force the Fed to raise interest rates in 2022
Market reaction: The Dow Jones Industrial Average DJIA,
and S&P 500 SPX,
they were set to open lower in trading on Thursday.