WASHINGTON (AP) – The U.S. economy grew at a modest annual rate of 2.2 percent in the fourth quarter, less than half the third quarter’s torrid 5 percent rate and weaker than the government first reported.
While the sharp slowdown seems troubling on the surface, economists say it’s actually nothing to worry about. They remain optimistic that the country is finally emerging from years of sub-par activity and is on course this year for the strongest growth in a decade.
Here are five reasons why Friday’s gross domestic product report showed that the economy is doing just fine:
-REALISTIC GROWTH
The sizzling growth rate in the July-September quarter was never going to last. One-time factors, such as a 16 percent surge in federal defense spending, fueled the strongest acceleration in almost a dozen years. The third quarter growth followed a 4.6 percent jump in the second quarter, which was also misleading. That was credited to a robust rebound after harsh winter weather sent the economy into reverse in the first quarter. After such big swings, it’s natural that economic growth would settle into a more sustainable pace.