- Gross domestic product was expected to expand at 2.2% in the fourth quarter.
- The labor market was strong between October and December, but expectations for economic growth have dimmed.
- The report was delayed due to the government shutdown that ended in January.
Data out Thursday is expected to show the US economy grew at a slightly slower but still solid pace at the end of 2018.
Economists expect the Commerce Department to say gross domestic product expanded at an annual rate of 2.2% between October and December, a slowdown from 3.4% in the third quarter. The release was delayed due to the 35-day partial government shutdown at the start of the year.
“Fourth quarter GDP growth likely was constrained by foreign trade, inventories and sluggish capex,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics. “Growth probably will be revised higher, but the run of 3%-plus GDP prints is over.”
The unemployment rate held near historic lows throughout the fourth quarter, and there were signs of upward pressure on wages. But expectations for growth in major economies have dimmed, with a series of data releases raising concerns about soft spots in the economy in recent weeks.
“A healthy labor market has typically been a strong signal for solid consumption and economic growth in the U.S., but weaker than expected retail sales data from December has cast doubts on how resilient the U.S. economy is from the weight of slowing global growth,” said Charlie Ripley, senior investment strategist at Allianz Investment Management.