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The U.S. economy grew more rapidly in the fourth quarter than previously estimated, as consumer spending climbed by the most in three years, showing the expansion had momentum heading into this year’s harsh winter.
Gross domestic product grew at a 2.6% annualized rate from October through December, more than the 2.4% gain reported last month, figures from the Commerce Department showed today in Washington. The median forecast of 79 economists surveyed by Bloomberg called for a 2.7% increase.
Robust consumer spending on services, particularly health care, helped accelerate the expansion, a sign that this year’s slowdown is partly due to heavy snowfall and freezing temperatures.
“The underlying strength in the economy is reasonably good and was accelerating before we had the bad weather,” David Berson, chief economist at Nationwide Insurance in Columbus, Ohio, said before the Commerce Department report was released. “Once we get past the first quarter and we get a real GDP reading, in the second quarter we should see a rebound.”