Many experts feared a recession. Instead, the economy has continued to soar
The nation's gross domestic product — the broadest measure of economic activity — grew at an annual pace of 3.3% in October, November, and December, faster than forecasters had expected.
It was a fitting end to a year of robust economic growth, defying projections.
"Housing usually in a high-rate environment gets crushed," Zandi said. "It's the thing that drives the economy into the ground. That just didn't happen this time around. Instead, new home construction helped make a positive contribution to GDP".
The unemployment rate has remained under 4% for nearly two years.
Wages are now growing faster than prices. "Not only was it not a bad year," Zandi said. "It was a really good year."
The stock market is hitting record highs.
Price indexes in the GDP report show inflation continued to ease. That will be reassuring to the Fed, which is widely expected to begin cutting interest rates later this year.
"Stronger-than-expected GDP growth rate in the fourth quarter is viewed as 'Fed friendly,'" said chief economist Jay Bryson of Wells Fargo Economics. Bryson expects the central bank to begin lowering rates.
