The US economy witnessed a sluggish expansion in the fourth quarter of 2014 than previously thought after it was restrained by a widening trade gap and minimal gain in stockpiles.
According to the US Commerce Department report, the country’s economy expanded at 2.2 percent annual rate during the fourth quarter.
The economic growth, which is measured by the gross domestic product (GDP), was weaker than the initial estimations of 2.6 percent in January.
The lower rate of economic growth has marked a significant slowdown from the third quarter, when the strongest growth was witnessed in 11 years.
The median forecast of 83 economists showed a two percent annual growth pace of the American economy.
The consumer spending surged by the most in four years during last quarter as it underlined the underlying strength of the expanding economy of the country.
An improving labor market of the country as well as cheaper fuel costs is believed to be helping in underpinning the households this year. This is expected to assist the country in overcoming a slowdown witnessed in its exports sector.
“The economy is still chugging along pretty nicely. We’re seeing better job growth, the decline in gas prices is really going to be beneficial for consumers and small businesses, and that should help the pace of growth to pick up,” said chief economist Scott Brown, from Raymond James & Associates in Florida.
The market analysts also hold trade responsible for weighing more heavily on growth compared to initial estimates. They said trade contributed to the subtraction of 1.2 percentage points amid stronger growth in imports.