The U.S. economy expanded faster than expected in the fourth quarter of 2022 as consumers in the world’s largest economy maintained a solid pace of spending.
In the fourth quarter, the U.S. economy grew at a 2.9% annualized rate, according to the data released by the Commerce Department on Thursday. The growth beat economists expectations by Reuters poll that forecast a 2.6% growth.
Even with rising spending in the fourth quarter, data showed that momentum had shifted to a snail pace by the end of the year amid higher interest rates that eroded consumers’ demand.
For 2022, the U.S. economy grew 2.1%, down from the 5.9% in 2021.
The U.S. Federal Reserve last year raised interest rates by a total of 425 basis points, bringing the benchmark from near zero to a 4.25%-4.50% range, which was the highest since level late 2007.
Meanwhile, the Labor Department announced on Thursday that initial claims for unemployment benefits fell by 6,000 to a seasonally adjusted 186,000 for the week ended January 21, hitting the lowest level since April 2022.
