Awkward: USD growth comes in below expectations
Donald Trump's speech at Davos may have sung the praises of the US economy, but as he spoke, of..
Donald Trump's speech at Davos may have sung the praises of the US economy, but as he spoke, official figures suggested growth in the US economy was weaker than expected.
Growth hit 2.6 per cent in the fourth quarter of the year, figures from the Bureau of Economic Analysis (BEA) showed, below economists' expectations of three per cent.
The figure was down from 3.2 per cent growth in the pervious quarter, although it was higher than the 1.8 per cent growth during the same period the year before.
The BEA said the growth reflected positive contributions from consumer spending, exports and local government spending.
The findings mean real GDP increased 2.3 per cent in 2017, up from 1.5 per cent in 2016, the BEA added.
The release coincided with Trump's speech at Davos, in which he said there had "never been a better time to hire, to invest, to build in the United States".
Economists suggested that although the growth missed predictions, it was still strong.
“Trump will be disappointed today after the fourth-quarter GDP figures showed his initial targets have fallen short of the mark, but the US is still on a sound financial footing," said Dennis De Jong, managing director at UFX.com.
“The Trump administration had targeted three per cent growth but despite the latest figures falling below expectations, the President still has reasons to be bullish."
“Although the markets remain resilient, Trump’s “America First” message that he is asserting in Davos could push potential trading partners away. With global politics still on a knife-edge, there’s still the potential for the slightest trigger to see traders reach for the panic button.”
The dollar remained weak after the figures, falling 0.6 per cent against sterling to £0.7030, and dropping 0.2 per cent against the euro, to €0.8049.
Read more: Davos: Donald Trump tells industry leaders "America is open for business"
