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The fourth quarter of the economy saw faster-than-expected growth, but could it be headed for a slowdown?
Gross domestic product (GDP) increased at a 2.9% annualized rate last quarter showing resilience, said the Department of Commerce’s advance fourth-quarter GDP report on Thursday, but:
- The growth came in the early part of the quarter
- Businesses released the inventory they were holding on to, boosting growth
Though the GDP number is below the previous three months, compared to the first half of the year (when GDP shrank) it marks a significant improvement.
Seeing the current economic terrain, experts believe a soft landing might be possible as the Fed has continuously been increasing the interest rates to stifle inflation.
But the same GDP report also pointed out a few worrisome signs indicating we might not be entirely out of the stormy waters yet. Several layoffs, a slowdown in business spending, a fall in the housing market and reduced consumer spending, all paint a slightly grim picture.