The US economy expanded in the fourth quarter at the fastest pace in a year, reflecting more consumer purchases of US-made goods and the biggest government spending increase since 1978.
GDP rose at a revised 1.4 percent annual rate from October to December, the Commerce Department said. The pace was faster than the 0.2 percent rate of increase reported by the government last month and exceeded the 0.9 percent rise expected by analysts.
US companies were able to clear unwanted inventories last quarter as Americans increased spending on US-made automobiles and other big-ticket items. That is prompting manufacturers to raise production, which could lead to faster growth this quarter.