Business News
LEAD: US economy climbs 2.8 per cent, less than expected
Jan 27, 2012, 15:19 GMT
Washington - US gross domestic product (GDP) grew less than forecast in the fourth quarter as consumers boosted spending and government agencies cut back on spending.
GDP, the value of all goods and services produced, grew at 2.8 per cent, according to an advance estimate released Friday by the Bureau of Economic Analysis (BEA), although economists had predicted a 3-per-cent rise.
Still, the fourth quarter was up from a 1.8-per-cent gain the previous quarter.
US Federal Reserve officials said earlier this week that they were concerned about the economy's lack of gumption two years after the end of the worst recession in decades.
The improvement in the US job market - the jobless rate dropped to 8.5 per cent last month from 8.6 per cent - has yet to translate into wage gains large enough to spur bigger gains in household spending, which accounts for 70 per cent of the US economy.
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