GDP Revised to 2.4%, Initial Claims Decline—Cooling Inflation Supports Growth Outlook

From an industry perspective, private services-producing sectors grew 2.4%, while goods-producing industries rose 2.3%. Government output increased 2.7%, underscoring fiscal spending’s ongoing role in supporting growth. Real gross output expanded 1.7% overall, led by a 3.1% increase in government production.

Inflation Trends Hold Steady

The price index for gross domestic purchases rose 2.2% in Q4, revised slightly lower, while the core personal consumption expenditures (PCE) index increased 2.6%, down 0.1 point. These revisions suggest inflationary pressures are receding modestly, reinforcing the Federal Reserve’s cautious stance. The average of real GDP and GDI—a broader measure of economic activity—stood at 3.5%, highlighting stronger income-side growth of 4.5% in Q4.