Friday, January 30, 2015
YOLO COUNTY NEWS
99 CENTS

Economy expands at 0.4 percent rate

By
From page A2 | March 28, 2013 |

WASHINGTON (AP) — The U.S. economy grew at a slightly faster but still anemic rate at the end of last year. However, there is hope that growth accelerated in early 2013 despite higher taxes and cuts in government spending.

The economy grew at an annual rate of 0.4 percent in the October-December quarter, the Commerce Department said Thursday. That was slightly better than the previous estimate of 0.1 percent growth. The revision reflected stronger business investment and export sales.

Analysts think the economy is growing at a rate of around 2.5 percent in the current January-March quarter, which ends this week.

Steady hiring has kept consumers spending this year. And a rebound in company stockpiling, further gains in housing and more business spending also likely drove faster growth in the first quarter.

The 0.4 percent growth rate for the gross domestic product, the economy’s total output of goods and services, was the weakest quarterly performance in almost two years and followed a much faster 3.1 percent increase in the third quarter. The fourth quarter was hurt by the sharpest fall in defense spending in 40 years.

For all of 2012, the economy grew 2.2 percent after a 1.8 percent increase in 2011 and a 2.4 percent advance in 2010. Since the recession ended in mid-2009, the economy has been expanding at sub-par rates as a string of problems from higher gas prices to Europe’s debt crisis have acted as a drag on the U.S. economy.

Growth appears to be strengthening this year even after taxes increased on Jan. 1 and automatic government spending cuts totaling $85 billion started to take effect on March 1. The Congressional Budget Office has estimated that the combination of tax increases and spending cuts could trim economic growth this year by about 1.5 percentage points. The CBO is predicting just 1.5 percent growth for 2013.

But so far, the economy is showing signs of holding its own against the fiscal drag.

Employers have added an average of 200,000 jobs a month since November. That helped lower the unemployment rate in February to 7.7 percent, a four-year low.

Economists expect similar job gains in March, in part because a measure of unemployment benefit applications fell this month to a five-year low.

Sales of previously occupied homes rose in February to the highest level in nearly three years, while builders broke ground on more houses and apartments. Annual home prices jumped in January by the most since June 2006, according to a closely watched measure.

Stock prices have surged. On Wednesday, the Standard & Poor’s 500 index was within two points of its all-time high.

All of that is making consumers feel wealthier, which could lead to more spending. Consumer spending drives 70 percent of economic activity.

The Federal Reserve still thinks the economy needs aggressive measures to bolster growth. Last week it stood by its plan to keep a key short-term interest rate near zero until unemployment drops below 6.5 percent. The Fed also left unchanged its plan to keep buying $85 billion in bonds until it sees a substantial improvement in the job market.

The slowdown in business inventories trimmed 1.5 percentage point from growth in the fourth quarter and the reductions in defense spending cut another 1.3 percentage point from growth.

Consumer spending was growing at a 1.8 percent rate in the fourth quarter, slightly better than the 1.6 percent increase in the third quarter but down from last month’s estimate that consumer spending was growing by 2.1 percent.

That revision was offset by upward revisions in business investment spending on structures and equipment and by stronger sales of U.S. exports.

The government first estimated two months ago that the economy had contracted at an annual rate of 0.1 percent in the fourth quarter, a decline that was erased by the revisions.

The government will release its first look at first quarter growth on April 26.

————

By Martin Crutsinger, AP economics writer

Comments

comments

The Associated Press

.

News

Suspected Ebola patient being treated at UCD Med Center

By San Francisco Chronicle | From Page: A1

 
Town hall focuses on Coordinated Care Initiative

By Anne Ternus-Bellamy | From Page: A1

Schools give parents tools to help kids thrive

By Enterprise staff | From Page: A1 | Gallery

 
Need a new best friend?

By Enterprise staff | From Page: A2 | Gallery

 
Stanford University to get $50 million to produce vaccines

By The Associated Press | From Page: A2

Two more cases of measles in Northern California in children

By The Associated Press | From Page: A2

 
Dartmouth bans hard liquor

By New York Times News Service | From Page: A2

 
No bare bottoms, thanks to CommuniCare’s Diaper Drive

By Special to The Enterprise | From Page: A3 | Gallery

Storyteller relies on nature as his subject on Saturday

By Enterprise staff | From Page: A3

 
Still time to purchase tickets for DHS Cabaret

By Enterprise staff | From Page: A3

All voices welcome at sing-along Wednesday

By Enterprise staff | From Page: A3

 
Great Chefs Program will feature Mulvaney

By Special to The Enterprise | From Page: A3

Walkers head out three times weekly

By Enterprise staff | From Page: A3Comments are off for this post

 
Free tax preparation service begins Monday

By Special to The Enterprise | From Page: A3

Vote for your favorites in Readers’ Choice poll

By Enterprise staff | From Page: A3

 
February science fun set at Explorit

By Lisa Justice | From Page: A6 | Gallery

 
Take a photo tour of Cuba at Flyway Nights talk

By Enterprise staff | From Page: A6 | Gallery

See wigeons, curlews and meadowlarks at city wetlands

By Special to The Enterprise | From Page: A8 | Gallery

 
.

Forum

Time for bed … with Grandma

By Creators Syndicate | From Page: B5

 
Olive expert joins St. James event

By Letters to the Editor | From Page: A10

We’re grateful for bingo proceeds

By Letters to the Editor | From Page: A10

 
Tom Meyer cartoon

By Debbie Davis | From Page: A10

 
A ‘new deal’ for the WPA building

By Special to The Enterprise | From Page: A10

Protect root zone to save trees

By Letters to the Editor | From Page: A10

 
Weigh quality of life, density

By Letters to the Editor | From Page: A10

.

Sports

UCD has another tough football schedule in 2015

By Enterprise staff | From Page: B1

 
Gould’s influence felt mightily in recent Super Bowls

By Bruce Gallaudet | From Page: B1

Mustangs hold off UCD women

By Enterprise staff | From Page: B1 | Gallery

 
UCD men set new school D-I era win record

By Bruce Gallaudet | From Page: B1 | Gallery

Sharks double up Ducks

By The Associated Press | From Page: B2 | Gallery

 
Sports briefs: Watney, Woods start slow at TPC Scottsdale

By Enterprise staff | From Page: B2

Recall that first Aggie TV game, national title?

By Bruce Gallaudet | From Page: B8 | Gallery

 
.

Features

.

Arts

‘Song of the Sea’ is an enchanting fable

By Derrick Bang | From Page: A11 | Gallery

 
‘Artist’s Connection’ launches on DCTV

By Special to The Enterprise | From Page: A11

 
Gross’ paintings highlight a slice of Northern California

By Enterprise staff | From Page: A12 | Gallery

February show at YoloArts’ Gallery 625 is ‘Food for Thought’

By Special to The Enterprise | From Page: A12 | Gallery

 
.

Business

.

Obituaries

.

Comics

Comics: Friday, January 30, 2015

By Creator | From Page: A9