WASHINGTON: The world’s largest economy grew more slowly at the end of 2017 than first reported, with lower sales of durable goods and consumer items, official data showed Wednesday.
The downward revision underscored the modest result for GDP growth over all of 2017 but did not reflect the expected boost from the sweeping $1.5 trillion tax cuts enacted at the end of December, which economists say will juice economic performance in the near-term.
GDP grew by an estimated 2.5 percent in October-December period, down a tenth of a percentage point from the estimate published last month, according to the Commerce Department.
The result matched analyst expectations and left the whole-year estimate for 2017 unchanged at 2.3 percent, up from 1.5 percent in 2016.
President Donald Trump has vowed to return the United States to sustained annual growth of three percent or higher and the White House is counting on the economy to step on the gas in order to pay for the costly December tax overhaul, which lowered corporate tax rates 14 points to 21 percent.
Economists say however this may be unrealistic, and estimates for the first quarter of 2018 are well below this rate.
The new estimate for growth in the fourth quarter was based on a fuller set of data and reflected lower goods exports, reduced federal defense spending and shrinking revenues from intellectual property rights.
Consumers bought fewer soft drinks as well as less clothing and gasoline than originally estimated, the Commerce Department reported.