The numbers: The US economy expanded in the fourth quarter at a revised annual rate of 4.3% – a higher-than-previously reported hit – and even faster growth is expected in the coming months.
Gross domestic product is up 4.1% from the previous reading, mainly due to slightly higher investment in business, according to revised government figures.
The economy appears to be accelerating again after slowing towards the end of the year, following a record outbreak of coronavirus. Economists surveyed by the Dow Jones and The Wall Street Journal predict that GDP will grow by 4.9% in the spring and 7% in the summer.
GDP is the sum of all goods and services produced by the economy and is a kind of scorecard for US performance.
The Economic Analysis Bureau updates the GDP ratio twice after the initial launch, as more timely information is obtained to provide a more complete picture of the performance of the economy.
Read: The US economy accelerates in March – and is not about to slow down
What happened: The biggest change in the GDP report in the fourth quarter was that of business investment. Investments in stocks, intellectual property and residential housing were much higher than previously reported.
Exports also increased by a revision of 22.3% compared to the previous reading of 21.8%. State and local spending was also not as weak as previously reported.
Rising consumer spending – by far the largest contributor to GDP – fell a tick to 2.3% from 2.4%.
Most of the other figures winning the report have changed little.
The whole picture: The economy is growing again due to declining coronavirus cases, growing vaccinations and warmer weather. A $ 1.9 trillion federal incentive will give the economy an extra boost.
The biggest unknown is whether the coronavirus will continue to disappear.
Another potential spin is rising inflation. The recovery has led to a flood of rising prices in many key supplies, a problem exacerbated by a growing shortage of key materials from timber and computer chips.
Read: Economists say inflation risks the most in the last two decades and could force the Fed to raise interest rates in 2022
Market reaction: Dow Jones Industrial Average DJIA,
and S&P 500 SPX,
they were open below in Thursday trades.