GDP Falls Sharply in Fourth Quarter

Washington, DC, January 30, 2008--The U.S. economy grew at a 0.6% annual rate in the fourth quarter, the weakest growth since 2002, the Commerce Department reported Wednesday.

The economy grew at a 4.9% pace in the third quarter.

Consumer spending and business investments decreased in the fourth quarter. Investments in housing fell at the fastest clip in 26 years. The reduction in inventories was also a major drag on growth in the quarter. Exports grew more slowly.

For all of 2007, GDP, at $13.84 trillion, grew 2.2 percent compared to growth of 2.9 percent in 2006.

Disposable incomes increased 0.3 percent in the quarter.

Gross domestic purchases increased 0.2 percent, the smallest increase since the recession in 2001.