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Economic Growth Slows, but Consumer Spending Soars

Economic Growth Slows, but Consumer Spending Soars

US consumer spending grew at the fastest clip in nine years in the fourth quarter, but was not enough to avoid a slower rate of overall economic growth. GDP grew just 2.6%, thanks largely to a stark trade deficit and weak business investing. Economists had predicted a 3% climb. On the bright side, consumer spending jumped 4.3%, a rate last seen in the first quarter of 2006 and well above 3Q14's 3.2% pace.

Plummeting gas prices had a lot to do with the consumer spike. But the oil collapse also contributed to the 1.9% slide in capital expenditure, the biggest drop in over five years.