The US economy finished 2001 with more momentum than previously thought, a government report said today.
The commerce department said the US economy grew at a revised 1.7 per cent annual rate in the fourth quarter of 2001, faster than the 1.4 per cent pace previously reported and a turnabout from the 1.3 per cent rate of decline seen in the third quarter.
It was also the strongest quarterly economic clip since the fourth quarter of 2000.
The stronger-than-expected report supports the view of many analysts that the economy has likely turned the corner on one of the most shallow recessions in US history and is now in a recovery phase.
Forecasts for first-quarter growth hover in the 4 per cent to 5 per cent range, as consumers continue to spend and companies rebuild depleted inventories.
Still, firms found their bottom lines under pressure in the fourth quarter. Corporate after-tax profits fell by $50.4 billion in the quarter after a $34.7 billion drop in the third quarter.
It was the biggest quarterly decline since the first quarter of 1998. For 2001, after-tax profits dipped by 15.9 per cent, the first decline since 1982's 17.1 per cent drop.