Saturday, January 30, 2010

temporary good news for the economy

From Justin Lahart in the WSJ...

The U.S. economy grew at its fastest pace in six years in the last three months of 2009, expanding at a 5.7% yearly rate over the previous quarter, as businesses drew less from their stockrooms and stepped up purchases of equipment and software. Exports surged and consumers spent more.

But the pace of the recovery is unlikely to continue as strongly once the temporary jolt from the inventory drawdown passes and government stimulus fades, keeping unemployment high through the end of the year....

Of the 5.7% rise in gross domestic product, 3.4 percentage points came from businesses shrinking inventories more slowly than in the previous quarter. That's a plus for economic growth: When businesses pull fewer goods from warehouses, they have to produce more...


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