In the fourth quarter of 2023, the U.S. economy experienced higher growth than previously reported, with the Bureau of Economic Analysis revising Gross Domestic Product (GDP) up to an annual rate of 3.4%. Personal income also saw a significant increase of $230.2 billion, up $10.7 billion from the previous estimate. The primary driver of this update was upward revisions in consumer spending and nonresidential fixed investments, though private inventory investments decreased.
The increase in real GDP, adjusted for inflation, was recorded at 3.2%, which surpassed expectations for the fourth quarter of 2023. Factors contributing to this growth included consumer spending, government spending, exports, and fixed investments.
In addition to personal income and savings increases, U.S. corporate profits also rose by $5.9 billion in the fourth quarter of 2023 compared to a $9 billion increase seen in profits in the third quarter of 2023. The Bureau of Economic Analysis reported increases in real gross output across various sectors and industry groups for the whole year 2023, with seventeen out of twenty-two industry groups contributing to this rise.
Price indices for gross domestic purchases and personal consumption expenditures also saw increases in the fourth quarter of 2023, at 1.9% and 1.8% respectively, with the PCE index excluding food and energy seeing a notable rise at 2%. Overall, these updates indicate that the U
