- The U.S. economy slowed more than initially thought in the fourth quarter, kee...
WASHINGTON, - - The U.S. economy slowed more than initially thought in the fourth quarter, keeping growth in 2018 below the Trump administration’s 3 percent annual target, and corporate profits failed to rise for the first time in more than two years.
The economy grew at a 3.4 percent pace in the third quarter. The expansion will be the longest on record in July. Compared to the fourth quarter of 2017, the economy expanded 3.0 percent, revised down from the 3.1 percent reported last month. President Donald Trump has highlighted the year-on-year growth figure as proof that fiscal stimulus, which has contributed to a swelling of the federal government deficit, has put the economy on a sustainable path of strong growth.
There are signs the slowdown in growth persisted early in the first quarter, with retail sales rising modestly and manufacturing production and homebuilding tepid. These contributed to the Federal Reserve’s decision last week to bring its three-year campaign to tighten monetary policy to an abrupt end. The U.S. central bank abandoned projections for any interest rate hikes this year after increasing borrowing costs four times in 2018.
Investment in residential construction was revised to show it contracting at 4.7 percent rate instead of at a 3.5 percent rate, marking the fourth straight quarterly decline.
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