NYT/Reuters: Economy Grew Briskly in Final Quarter of 2004

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Economy Grew Briskly in Final Quarter of 2004
By REUTERS

Published: March 30, 2005


WASHINGTON (Reuters) - The U.S. economy ended 2004 with brisk momentum on the strongest surge of corporate profits in three years, the government reported on Wednesday, though there were signs that price pressures might be picking up.

Gross domestic product, which measures total output within U.S. borders, expanded at a 3.8 percent annual pace in the fourth quarter, the same as estimated a month ago, the Commerce Department said in its third and final estimate of GDP performance.

That was slightly less than the 4 percent GDP pace that Wall Street analysts had forecast but still reflected healthy growth, only slightly less than the third quarter's 4 percent rate. Most private-sector analysts anticipate steady expansion during 2005 but with some drag from rising oil prices as the year wears on.

Revisions in the final estimate of fourth-quarter GDP were minor. The department noted that business inventories grew at a slightly smaller annual rate of $47.2 billion instead of $51 billion estimated a month earlier. But that was largely offset by upward revisions to exports and spending on costly durable goods, including new cars.

Corporate profits after taxes climbed 12.5 percent during the fourth quarter to a record seasonally adjusted annual rate of $973 billion - the strongest increase in profits since an 18.9 percent surge in the fourth quarter of 2001. Profits had fallen 4.2 percent in the third quarter after a series of hurricanes wreaked havoc in several southeastern states....


http://www.nytimes.com/2005/03/30/business/30wire-econ.html