Exports and investment hike US growth estimate for end of 2013
THE US economy grew at a slightly faster pace than previously suggested at the end of 2013, rising at a 2.6 per cent annualised rate in the fourth quarter, instead of the 2.4 per cent previously expected.
The rate is down from the third quarter’s 4.1 per cent, but exports grew by 9.5 per cent annualised and fixed investment was up by 5.7 per cent on the same basis, both outstripping the previous period.
Unemployment figures yesterday also showed initial jobless claims fell, down to 311,000 in the week to 21 March, while the four-week average figure for continuing claimants of unemployment benefits fell to 2,823,000 in the week to 15 March, a 53,000 fall.
Despite the positive news, some analysts suggest a large chunk of long-term unemployed workers may not return to the labour force.
“If there is little prospect of getting the long-term unemployed, who account for an unusually large share of the overall jobless rate, back into work then wage growth could accelerate faster than the Fed currently expects,” said Paul Ashworth of Capital Economics