Economy grew solidly in fourth quarter

  @AnnalynKurtz January 30, 2014: 10:11 AM ET
gdp 013014 data

The U.S. economy ended the year with solid growth, driven by stronger consumer spending and exports.

Gross domestic product -- the broadest measure of economic activity -- grew at a 3.2% annual pace in the fourth quarter, according to a Commerce Department report. That figure beat economists' expectations, and although it's not indicative of gangbusters growth, the data seems to show the economy is moving forward modestly. GDP rose at a 4.1% clip in the third quarter.

"We've got a good balance, and that's a positive for job growth going forward," said John Silvia, Wells Fargo chief economist.

Consumer spending picked up at a 3.3% annual pace, its highest level of growth in three years. The strongest area for spending was food services and accommodation, a category that includes restaurants, bars and hotels. Spending on these services alone grew at a 10.2% annual rate in the fourth quarter, its fastest pace since 1992.

Spending also picked up in almost every other category, including clothing, autos and health care.

Meanwhile, international trade was a large driver of economic growth, as exports grew at a faster clip than imports from other countries.

But cuts in federal government spending continued to weigh on the economy. GDP would have grown at a 4.2% pace in the quarter, if it weren't for federal spending cuts, according to the report.

For the whole year, the economy grew 1.9%, down from a 2.8% growth rate in 2012. To top of page

Join the Conversation
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.36%4.24%
15 yr fixed3.39%3.26%
5/1 ARM3.36%3.27%
30 yr refi4.34%4.22%
15 yr refi3.38%3.24%
View rates in your area
Find personalized rates:
Rate data provided
CNNMoney Sponsors
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.