A new report confirms a picture of the sluggish growth of the US economy in 2016 with the world's largest economy growing at its slowest pace in five years.
The data by the US Commerce Department showed consumers had spent slightly more than originally believed but this was offset by downward revisions in government spending and business fixed investment.
“The increase in real GDP in the fourth quarter reflected positive contributions from personal consumption expenditures (PCE), private inventory investment, residential fixed investment, nonresidential fixed investment, and state and local government spending. These increases were partly offset by negative contributions from exports and federal government spending. Imports, which are a subtraction in the calculation of GDP, increased,” the Commerce Department said.
The data are released as US President Donald Trump is set to address a joint session of the Congress on Tuesday with many around the world waiting for details on his administration's economic policy agenda.
According to the official data, US gross domestic product grew by 1.6 percent in 2016, down from 2.6 percent in 2015 and the slowest pace recorded since 2011.
Economic revival was a touchstone of Trump’s presidential campaign but as figures show he is now facing huge challenges to deliver his economic promises.
Last week, US Treasury Secretary Steven Mnuchin pulled back from Trump's growth targets, saying the new administration's expansionary policies should lead to three percent growth by the end of next year.