US economic growth falls short of Trump’s target
US economic growth last year fell short of the Trump administration’s three per cent target, potentially sparking renewed criticism of the government’s $1.5 trillion tax cuts.
Gross domestic product grew at a rate of 2.9 per cent in 2018, the US Department of Commerce announced today.
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Gross domestic income rose 2.5 per cent in the year and gross domestic output increased by 2.7 per cent, Reuters reported.
The Trump administration has overseen huge tax cuts, including reducing the corporate tax rate to 21 per cent from 35 per cent, arguing that the cuts will deliver strong economic growth.
Economists have previously warned that the three per cent growth target is unrealistic and estimated that the rate at which the economy can expand without causing too much inflation is around two per cent.
The economic growth seen in 2018 was an acceleration from the 2.4 per cent growth recorded in 2017 and matched the performance in 2015 during the Obama administration.
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The economy grew 2.8 per cent in the 12 months through the fourth quarter of 2017.
The data released today also showed growth in consumer spending peaking in the second quarter and decelerating sharply in the final three months of 2018.