Feb 25, 2010
The latest data revision for the fourth quarter GDP result for the U.S. shows that largely on account of a reduced rate of inventory destocking in the manufacturing sector growth was a robust 5.9%.
This is good news. Exports were also up, as well as non residential fixed investment and business investment. Consumer spending was up but by a subdued amount.The housing market the scene of the original disaster that provoked this slump is showing some signs of recovery although month to month sales were down although higher than a year ago. The next quarter will reveal if this trend continues as inventories are drawn down by an up tick in production and sales.Since more of the stimulus monies will be spent in the next quarter this should help support the nascent recovery. If that happens then greater confidence should result in eventual employer rehiring and a reduction, albeit slowly, in the unemployment rate.
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