US economy's Q4 growth of 3.1% better than anticipated

The United States economy grew at a stronger rate in the fourth quarter than originally estimated, according to figures released Friday. The U.S. Bureau of Economic Analysis said the American economy expanded by 3.1 per cent in the final three months of 2010. That was a marginal improvement versus the agency's so-called flash estimate of 2.8 per cent.

Corporate profits grew by 2.3 per cent in the October-to-December period compared to the third quarter of 2010, according to numbers also released Friday.

Better still, company earnings rose a hefty 18 per cent compared to the one year ago period.

In addition, the U.S. Bureau of Labor Statistics noted that weekly unemployment claims fell by 5,000 in the most recent period and represents a three-month downtrend trend in this jobless indicator.

Regarding the GDP changes, economists noted the additional strength was more an absence of feebleness than a roaring recovery within the American business community.

"The main reason for the three-tenths upward revision was less weakness in private investment than initially reported. There was less of an inventory drag than previously reported", said Derek Holt and Gorica Djeric, economists with Scotia Capital Inc. in a note on the new numbers.

Non-residential private investment grew at an annualized pace of 7.7 per cent in the fourth quarter of 2010 compared to the preceding three months.

In its February estimate of fourth-quarter GDP, the BEA pegged private investment growth at 5.3 per cent. The U.S. government typically makes two estimates of GDP growth before popping out a final figure.

Canada's economy grew by 3.3 per cent in the final three months of 2010.

From CBC News