Q4 GDP Growth Revised Up To 3.1% Pace

The U.S. economy grew at a 3.1% real annual rate in last year’s fourth-quarter, the government reports in its third and final estimate for Q4 GDP. That’s up from the previously reported 2.8% pace. For all of last year, the economy expanded by 2.9%.

U.S. corporate profits surged by more than 20% in 2010, the best year for the private sector since 2004. The final estimate of Q4 corporate profits shows a 9.7% gain. “That’s impressive when you have nominal GDP growth of only 3.1%,” Joseph LaVorgna, chief U.S. economist with Deutsche Bank,” tells CNNMoney. “To get that kind of corporate profit growth is impressive, and a good sign for 2011.”
Looking backward, here’s how GDP and its major components have fared since the Great Recession ended in the second quarter of 2009:

Spending on capital goods (gross private domestic investment) has been leading the rebound on a relative basis since the recession ended, although the trend hit some turbulence late last year. In 2010’s fourth quarter, capital goods spending retreated for the first since the recovery began.
Personal consumption expenditures (PCE) are routinely the largest slice of GDP, accounting for roughly 70% of the economy. Here’s how PCE and its major subgroups have performed since the recession ended:

Spending on durable goods is far and away the leader in the PCE category on a relative basis. In last year’s fourth quarter, durable goods spending accelerated sharply, rising 21% on a real, seasonally adjusted annual basis, up from 7.6% in Q3.