The U.S. economy grew at a slower-than-expected pace in the final quarter of 2024, according to data released by the Commerce Department on Thursday. Gross domestic product (GDP) expanded at an annual rate of 2.3% from October through December, falling short of the 2.6% forecast by analysts.
Despite the weaker fourth-quarter performance, the economy maintained steady growth for the full year, expanding by 2.8%—just below the 2.9% recorded in 2023.
The Federal Reserve recently kept its benchmark interest rate unchanged after three rate cuts since September. Fed Chair Jerome Powell signaled a cautious approach to further reductions, stating, “we do not need to be in a hurry” to make additional cuts.
Policymakers remain watchful as progress against inflation has stalled in recent months after its decline from the four-decade highs reached in mid-2022.
Looking ahead, the economic outlook remains uncertain. Former President Donald Trump has pledged to cut taxes and ease business regulations, which could boost GDP growth. However, his proposed tariffs on imports and plans for mass deportations of undocumented workers may slow growth and drive up costs.
