GDP growth in the fourth quarter was revised up by 0.2 percentage points to a 3.4% seasonally adjusted annual rate, showing the economy ended 2023 on stronger footing than previously realized.

The new data, adjusted for inflation, were published Thursday by the Bureau of Economic Analysis in its report for GDP for the fourth quarter and for all of last year.

This was the third and final revision, meaning that these represent the final GDP figures. The data showed the economy expanded 2.5% for all of 2023, a rate that was not revised.

Thursday’s final report shows that the economy fared much better in 2023 than was expected. Notably, a year ago, Federal Reserve officials were projecting that GDP growth would only grow by 0.5% in 2023.

“Net, net, the economy outperformed in the second half of last year despite the attempt of Fed officials to rein in growth to limit demand and inflation pressures,” said Chris Rupkey, chief economist at FWDBONDS. “The way forward for the economy is not as clear in 2024 with increasing uncertainty and rising geopolitical risks.”

Fed officials anticipate that growth will slow to 2.1% this year.

President Joe Biden has touted last year’s GDP growth as proof that his “Bidenomics” agenda is working — despite his economic approval rating being down and voters consistently expressing concerns about the state of the economy.

The Fed began raising interest rates in March 2022 as inflation rose. At its peak, price growth crested at about a 9% annual pace.

Since that zenith, inflation has fallen to a 3.2% rate, according to the latest consumer price index numbers for January. That is still above the Fed’s preferred 2% level, although it shows the Fed’s two-year quest to tamp down inflation by raising interest rates has borne results.

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The labor market has also remained resilient despite the interest rate revisions.

The economy beat expectations again in February and added another 275,000 jobs, the Bureau of Labor Statistics reported last week. The unemployment rate is at 3.9%, remaining at a low level by historical standards.