Washington, D.C. – The Bureau of Economic Analysis has released the “third” estimate indicating that real gross domestic product (GDP) increased at an annual rate of 3.4 percent in the fourth quarter of 2023. This growth marks a slight deceleration from the 4.9 percent increase seen in the previous quarter.

The updated estimates are based on more comprehensive source data compared to the previous estimate, showing adjustments to various components of the GDP. Increases in consumer spending, state and local government spending, exports, nonresidential fixed investment, federal government spending, and residential fixed investment were notable drivers of the growth, although private inventory investment saw a decrease in the fourth quarter.

In terms of current-dollar GDP, there was a 5.1 percent increase at an annual rate, amounting to $27.96 trillion in the fourth quarter. This is an upward revision of $12.4 billion from the previous estimate, indicating a positive trend in economic activity.

The price index for gross domestic purchases rose by 1.9 percent in the fourth quarter, with the personal consumption expenditures (PCE) price index increasing by 1.8 percent. However, the PCE index excluding food and energy prices saw a slight downward revision to 2.0 percent.

Personal income showed significant improvements, with current-dollar personal income rising by $230.2 billion in the fourth quarter. Disposable personal income increased by $190.4 billion, while real disposable personal income saw a 2.0 percent increase. Personal saving also experienced an upward trend, reaching $815.5 billion in the fourth quarter.

Furthermore, real gross domestic income (GDI) increased by 4.8 percent in the fourth quarter, with profits from current production also showing positive growth. The report highlighted increases in profits of domestic financial corporations and nonfinancial corporations, while rest-of-the-world profits experienced a decrease.

Looking at the broader picture for 2023, real GDP showed a 2.5 percent increase, driven by gains in consumer spending, nonresidential fixed investment, and government spending. Private goods-producing industries saw a 2.7 percent increase, private services-producing industries also grew by 2.7 percent, and government increased by 1.4 percent.

In conclusion, the latest economic indicators point towards a positive momentum, with various sectors contributing to the overall growth of the economy. The data provided valuable insights into the health of the economy, highlighting key areas of strength and areas for potential improvement in the future.