During the fourth quarter of 2023, gross domestic product (GDP) grew at an annual rate of 3.3 percent, according to data released Thursday by the Bureau of Economic Analysis (BEA).
Growth in the final three months of the year outstripped the predictions of many economists, who forecasted a 2 percent gain.
“Despite fears over a looming downturn, the U.S. economy continues to grow at an above-average pace as consumer spending remains resilient,” Jesse Cohen, global markets analyst at Investing.com, wrote in a post on X.
“With that being said, some pockets of disinflation are starting to appear in the economy. What does the Fed do now?”
The state of the economy and voters’ perceptions of it are set to heavily influence the upcoming presidential election.
President Biden is running for reelection, and former President Trump has beat out most of his primary challengers, although his former U.N. Ambassador Nikki Haley remains in the race.
“Today we learned that the U.S. economy grew 3.1 percent over the past year while adding another 2.7 million jobs, and with core inflation moving back down towards the pre-pandemic benchmark. As a result, wages, wealth, and employment are higher now than they were before the pandemic,” Biden said in a statement.
Biden called out “extreme Republicans” in his statement, pointing out proposed cuts to Social Security and Medicare amid an ongoing federal spending fight.
Congress has extended the federal funding deadline three times since the end of September as several hard-line House Republicans push for major cuts to the federal budget.
Biden and Democrats are hoping to sell voters on “Bidenomics” and turn around Americans’ feelings about the economy as growth remains strong, inflation continues to fall and consumers are increasingly optimistic.
Despite recent positive data, Trump has predicted the economy will crash within the next year. The former president has also said he hopes a potential recession would start before he would take office if reelected.
“Whichever way you slice it, this report caps a year of stellar economic growth performance, particularly with the backdrop of the Fed’s aggressive monetary policy tightening cycle,” said Olu Sonola, head of U.S. regional economics at Fitch Ratings.
The Hill’s Sylvan Lane and Taylor Giorno have more here.
