Q4 2021 Economic Report

GDP GROWTH: TRENDING IN Q4 2021

The nation’s gross domestic product grew by 5.7% in 2021, the fastest rate since 1984. The Commerce Department also reported in its advance estimate released in late January that growth accelerated in the fourth quarter at an annualized rate of 6.9%, following a 2.3% reading for the third quarter.

The increase reflected gains in private inventory investment, exports, personal consumption expenditures, and nonresidential fixed investment that were partly offset by declines in federal, state, and local government spending. There was an increase in imports, which reduces the net GDP calculation.

Analysts expect a slowing in the first quarter due to high inflation and workers being kept home due to the highly contagious omicron variant of the COVID-19 virus.

Orders for durable goods fell 0.9% in December, which was more than expected, hitting their lowest point since April 2020 and reflecting a year-end slowing as infections skyrocketed.

The increase in private inventory investment was led by retail and wholesale trade industries. Within retail, inventory investment by motor vehicle dealers was the leading contributor.