US authorities have confirmed 1.9% economic growth of USA in Q4 2016. The economists had expected the second reading of the data to show that the increase in GDP was 2.1% annual growth rate. The slower pace of investment by businesses and by state and local authorities overshadows higher household consumption.
Namely consumer spending, which is the largest part of the economy, rose by 3%. This is above expectations, according to the Commerce Department. In previous assessment increase was estimated at 2.5%. The consumer purchases add 2.05 percentage points to growth rather than 1.7 percentage points, as was believed earlier. The second reading of the data reported higher costs for cars and health care.
In late March will be published the third and final reading of the report. For comparison, in the third quarter of last year, the annual growth rate was 3.5%.
Investment in non-residential assets grow by 1.3% yoy, which is less than previously thought. Business spending on equipment rose by 1.9%, the first increase in five quarters, but less than the initial estimate of 3.1% growth.
The trade deficit erased 1.7 percentage points from GDP growth, the data is unchanged.
The costs of the authorities contribute less to economic growth than initially thought. The state and local governments spend 1.3% more, which is twice less than the first estimate. The expenditure of the federal government remain without revision, having decreased by 1.2%.
During the period from October to December the US economy grew also by 1.9% compared to the same quarter last year, the value is also without revision.