The US economic growth slowed sharply in the fourth quarter of 2015 and the year ended with a total growth of 2.4%, similar to the expansion of 2014, according to the US Commerce Department. Among the causes of the slowdown decline of excess inventory companies, that is a drop in investment target, while the stronger dollar and weak global demand weighed on exports.
In this way, the Gross Domestic Product (GDP) rose 0.7% in the last quarter, while the third quarter had recorded a growth rate of 2%. Among the causes of the decline in economic activity, lower oil prices, which continued to undermine energy investments are also located. It is also considered that the effect of unusually mild weather have reduced consumer spending in energy and clothing. Excluding inventories and trade, the economy grew at a rate of 1.6 percent.
Despite the slowdown, the GDP report could spark a new wave of selling in the stock market, which was shaken by fears of anemic growth in both the United States and China.
The Federal Reserve (Fed, for its acronym in English) had acknowledged on Wednesday that growth “slowed late last year” , but also he noted that “labor market conditions improved further.” In this context, decided to maintain unchanged the US interest rate from 0.25% to 0.5%, which was raised last December for the first time since June 2006. Although the Fed has not ruled out another hike in March, the organization led by Janet Yellen offer concrete avoided the recent volatility seen in the markets both in the US references as in China.
In the fourth quarter, companies accumulated $ 68.6 billion dollars in inventory. While this is down from $ 85.5 billion in the third quarter, which was slightly more than economists expected. However, inventories suggest could remain a drag on growth in the first quarter of this year.
The small accumulation of inventories subtracted 0.45 percentage points from the first estimate of GDP growth in the fourth quarter.
Consumer spending, which accounts for over two-thirds of US economic activity, rose at a rate of 2.2%. That marked a step down from the rate of 3.0% in the third quarter.
The unusual weather struck in reduced winter clothes in December and the heating demand. With gas prices around $ 2 per gallon, a labor market suggesting a gradual improvement and some improvement in household wealth, economists believe the slowdown in consumer spending will be short lived.
However the dollar, which has gained 11% against the currencies of trading partners in the United States since last January, probably remained a drag on exports, resulting in a trade deficit played down 0.47 percentage points to GDP growth in the fourth quarter.
The slowdown in investment in the energy sector also could put more pressure on business spending on nonresidential structures. Spending on mining exploration, wells and sank at a rate of 38.7%, after falling at a rate 47.0% in the third quarter
Related Topics. USA / FED / International Business
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