US growth confirms a 2.3%

US GDP growth holds at 2.3%

The US economy expanded at an annualized rate of 2.3% in Q4, marking the slowest growth in three quarters but aligning with preliminary estimates. Consumer spending surged 4.2%, the strongest increase since Q1 2023, reinforcing its role as the primary driver of economic expansion. Meanwhile, the Federal Reserve’s preferred core PCE inflation gauge was revised up to 2.7% from the initial 2.5% estimate, mainly due to rising service sector costs.

US jobless claims surge to 242K

At the same time, signs of labor market softening emerged as US initial jobless claims jumped by 22,000 to 242,000 in the week ending February 22, exceeding expectations of 220,000. The four-week average of claims rose to 224,000, while continuing claims fell by 5,000 to 1.862 million, suggesting that while layoffs increased, overall employment remained relatively stable.

No forward guidance yet from ECB

In Europe, the ECB’s latest meeting minutes reflected a cautious stance on rate cuts, despite policymakers acknowledging a “clear case” for a 25bps reduction. The central bank noted that disinflation remains on track, increasing confidence in inflation’s convergence toward the 2% target. However, lingering concerns over energy prices, strong wage growth, and services inflation led officials to avoid committing to forward guidance. Policymakers also highlighted geopolitical risks, fiscal policy uncertainties within the Eurozone, and global trade challenges as potential downside risks to growth, reinforcing the need for a data-driven approach to future rate decisions.