Reflecting better performance in December international trade and construction spending, substantial upward revisions to net exports and business investment in structures helped lift Q4 real GDP to a 0.1 percent annualized rate from the advance reading of -0.1 percent.
-Economics Group, Wells Fargo
Positive Week: Encouraging for Q1 GDP Growth
• As had been widely expected, fourth quarter real GDP
was revised from a slight negative to a slight positive on
a better-than-initially-thought performance from
business fixed investment and trade.
• In spite of the ongoing policy headwinds, the U.S.
economy is experiencing better performance out of the
January and early February indicators, which point to a
pick-up in the pace of real GDP growth. We expect an
increase in real GDP of nearly 3 percent (annualized) in
the first quarter.
The Global Economy is Still Fragile
• This week’s Italian election results reminded markets of
the fragility of the Eurozone economy and the risks
associated with political developments that could
potentially threaten the currency area’s chosen path of
fiscal tightening.
• Moody’s ratings agency took away the United Kingdom’s
triple-A rating although Standard & Poor’s and Fitch
have kept it without change for now.
• The Brazilian economy grew 0.6 percent quarter-overquarter in Q4 and 0.9 percent in 2012.
