By Nelson D. Schwartz
New York Times News Service
The U.S. economy grew by 2.6 percent in the final months of 2013, the Commerce Department said Thursday, a slight uptick from its previous estimate but still well below the pace of growth recorded in the third quarter.
The revised data for last quarter, in what was the government’s third and final estimate of economic growth for the period, reflected slightly healthier consumer spending than first thought.
The previous estimate for the months of October, November and December, reported in late February, was 2.4 percent. Thursday’s slight upward adjustment was in line with expectations among economists on Wall Street. The pace in the third quarter was 4.1 percent.
Still, the 3.3 percent increase in personal consumption expenditures last quarter was the healthiest showing since the fourth quarter of 2010, when consumption rose 4.3 percent.
It also came despite wintry weather in many parts of the country during the final weeks of the holiday shopping season, which prompted some economists to conclude that underlying consumer behavior was somewhat more robust than recent data had suggested.
“The number for gross domestic product is good,” said Lawrence Creatura, a portfolio manager at Federated Investors in Rochester, N.Y. “It is not the exciting number that is typical of postrecession recoveries, but it is good enough. This has been a stumbling sort of recovery all along, and this number is a continuation of that pattern.”
One part of the economy that has grown over all in recent years, the housing sector, seems to be slowing markedly.
The National Association of Realtors reported Thursday that its index of pending home sales dropped 0.8 percent in February to 93.9, the eighth straight monthly decline and the lowest level for the index since October 2011.
The drop, showing demand for previously owned homes rather than new construction, reflects the impact of cold weather as well as the rise in interest rates since the spring of 2013.
As the Federal Reserve gradually eases up on its stimulus efforts and reduces the pace of its monthly bond purchases, 10-year bond yields have crept up, pushing up rates for most mortgages. Housing was crushed in the recession of 2007 to 2009, but rebounded in many parts of the country more recently.