Thanks to increases in consumer spending, government spending, private inventory investment, and non-residential fixed investment, the U.S. GDP rose at a 2.9% annualized pace in the fourth quarter. Spurred by the cooling signs of inflation in the past few months, the central bank scaled back to a quarter-percentage-point rate increase after a year of massive hikes.
While the investors and equity markets rejoiced, Fed Chair Jerome Powell suggested a ‘couple’ more hikes in the upcoming months. Such hawkish comments indicate that a Fed pivot is not on the horizon even as global economic recession fears loom.
