The AMI-Partners Blog

Good news today in the Washington Post. The U.S. economy “soared” at its highest growth rate in six years (5.7%):

The U.S. economy roared ahead in the final months of 2009, growing at its fastest rate in six years, as corporate America stopped slashing its inventories and again started to invest for the future.

Gross domestic product, the broadest measure of economic activity, rose at a 5.7 percent annual rate in the fourth quarter, the Commerce Department said Friday. That is the highest pace of growth since 2003, and it constitutes strong proof that the recession reached its end earlier in 2009. It was also a surprisingly positive result, well above the 4.6 percent rate of GDP growth forecasters had expected.

Some of this is just an adjustment from the prior quarter, the article notes:

But there remained reason to doubt how strong the economic recovery will be in 2010. The biggest component of the GDP growth was a steep drop in the pace at which businesses were cutting back on their inventories. Firms reduced their inventories by $33.5 billion in the fourth quarter, compared with $139 billion in the third. In the math of GDP, which attempts to capture the value of goods and services produced within U.S. borders, that added 3.4 percentage points to overall growth.

Read the whole story here: