Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, February 27, 1993 TAG: 9302270077
SECTION: BUSINESS PAGE: A-7 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
GROWTH SPRINT A 5-YEAR RECORD
A consumer spending spree helped produce the best economic growth in five years during the final quarter of 1992, the government said Friday.But consumer confidence has slipped a bit since then; and analysts said economic growth, while continuing, was unlikely to repeat the robust performance anytime soon.
The gross domestic product, the sum of all goods and services produced in the United States, advanced at a 4.8 percent annual rate in October-December, the Commerce Department said in a revised report.
That was substantially better than the department's initial estimate a month ago of 3.8 percent.
Economist David Munro of High Frequency Economics in New York predicted "a very slow steady recovery" this year, with growth of about 3 percent, compared with 2.1 percent for all of 1992.
"The bottom line of this is that however much insurance we thought we had to buy in the form of a stimulus program, we probably don't need it now," he said.
Economist Lawrence Chimerine of DRI-McGraw Hill, a Lexington, Mass., forecasting firm, said "a small stimulus package . . . is still a reasonable thing to do as long as it doesn't add too much to the deficit."
"My guess is we've seen the fastest growth quarter we will see for a while. The economy will continue to expand, but we're not in an economic boom and it will still be an economy that lags behind traditional recoveries," he said.
Carol S. Carson, director of the Commerce Department's Bureau of Economic Analysis, said recovery from the recession, despite the robust growth at the end of 1992, still must be considered sub-par.
During the seven quarters since the economy hit bottom in the first three months of 1991, output has grown 4.1 percent. That's only a little more than half the 7.9 percent average for the same period of other recent recoveries.
The Commerce Department attributed its fourth-quarter revision to better-than-expected exports, which advanced at a 9.8 percent annual rate instead of 3.7 percent, and to an improvement in consumer spending, which rose at a 4.8 percent annual rate instead of 4.3 percent. Growth in inventories also was revised upward.
Other bright spots included a gain at a 26.1 percent rate in housing construction and a 14.4 percent rate advance in business investment in new equipment.
Detracting from growth were a 1.1 percent decline at an annual rate in commercial construction and a 2.1 percent rate drop in government spending.
The various changes brought GDP to a seasonally adjusted $4.99 trillion.