MNI BRIEF: 4Q US Growth Beats Estimates On Consumer Strength

U.S. GDP grew at a faster-than-expected 3.3% annual rate in the fourth quarter of 2023, driven by consumption growth at 2.8%, underscoring the resilience of the economy even as interest rates rose sharply. Wall Street had expected growth of 2.0%, down from a very hot 4.9% in the third quarter.

Inflation also continued to decline, adding to evidence of a soft landing for a Federal Reserve that's contemplating a turning point in monetary policy this year. (See: MNI INTERVIEW: Fed Can Wait Until Summer To Cut Rates-English) Headline PCE inflation, the Fed's preferred measure of price growth, fell to 1.7% in the fourth quarter from 2.6% in the third, and core PCE inflation was steady at 2.0%. Headline inflation was 3.7% for the year, compared to 6.5% in 2022, and core PCE inflation slowed to 4.1% from 5.2% a year ago, the Bureau of Economic Analysis said Thursday.