The US economy ended 2004 with brisk momentum on the strongest surge of corporate profits in three years, though there were signs that price pressures might be picking up.
Gross domestic product, which measures total output within US borders, expanded at a 3.8 per cent annual pace in the fourth quarter, the same as estimated a month ago, the Commerce Department said in its third and final estimate of GDP performance.
That was slightly less than the 4 per cent GDP pace that Wall Street analysts had forecast but still reflected healthy growth, only slightly less than the third quarter's 4 per cent rate.
Corporate profits after taxes climbed 12.5 per cent during the fourth quarter to a record seasonally adjusted annual rate of $973 billion - the strongest increase in profits since an 18.9 per cent surge in the fourth quarter of 2001.
Profits had fallen 4.2 per cent in the third quarter after a series of hurricanes wreaked havoc in several southeastern states.
There was some evidence that inflation might be perking up. A price index favored by Federal Reserve Chairman Alan Greenspan - personal consumption expenditures excluding food and energy products - gained at a 1.7 per cent annual rate in the fourth quarter, up from a 1.6 per cent estimate a month ago and nearly twice the 0.9 per cent third-quarter rate of increase.
For all of 2004, US GDP expanded 4.4 per cent. That was the strongest growth in five years, since a 4.5 per cent advance in 1999, and was well ahead of the 3 per cent posted for 2003.