U.S. Economy See Fourth Quarter Upward Revision as Consumer Spending Surges and Prices Rise

The U.S. economy experienced an upward revision in the fourth quarter of 2023, according to a report released by the Bureau of Economic Analysis on Thursday. Real Gross Domestic Product was revised up to an annual rate of 3.4%, reflecting an increase in consumer spending, government spending, exports, and fixed investments.

Personal income also saw gains, increasing by $230.2 billion in the fourth quarter, with personal savings growing by $6.3 billion to $815.5 billion. The saving rate climbed to 4.0%, reflecting positive trends in personal income and savings. Domestic U.S. corporate profits increased by $5.9 billion, compared to a $9 billion rise in the third quarter of 2023.

Looking at 2023 as a whole, the BEA reported that real gross output increased by 2.1%, with private goods-producing industries up by 2% and private services-producing industries up by 2.1%. Government output also saw an increase of 2.2%. Prices also saw an increase, with the price index for gross domestic purchases up by 1.9% and personal consumption expenditures increasing by 1.8%.

The PCE index excluding food and energy saw an increase of 2.0%, reflecting overall positive trends in the economy for the fourth quarter of 2023, indicating that consumers were confident enough to spend more money on goods and services despite rising prices