How long can consumers keep the economy humming?

Consumers boosted growth, defying recession warnings. The question is whether 2024 will be different.

Customers visit the American Mall dream mall during Black Friday on November 25, 2022 in East Rutherford, New Jersey
Consumers spent heavily on all kinds of things last year
(Image credit: Kena Betancur / Getty Images)

Strong economic data is continuing to pile up, thanks largely to consumers who have spent heavily and helped defy months of warnings that the United States was heading for a recession. The Commerce Department reported Thursday that the economy grew by 3.1% in the past year, up from less than 1% in 2022 and far better than the 2% expansion economists had been expecting. The pace slowed from an annualized rate of 4.9% in the summer to a still healthy 3.3% in the fourth quarter, confirming that the economy remained remarkably resilient, The New York Times noted, despite aggressive Federal Reserve interest rate hikes intended to bring down inflation by slowing the economy.

Adding to last week's good news, the Commerce Department revealed Friday that its measure of consumer prices — the Federal Reserve's preferred inflation indicator — rose 0.2% in December from November, putting it up just 2.6% in the past year. In the last six months of the year, Bloomberg reported, prices rose at about a 2% annual rate, roughly hitting the Fed's inflation target — at least for that period — after a rapid plunge from the 7.1% year-over-year rate recorded in June 2022.

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Harold Maass, The Week US

Harold Maass is a contributing editor at The Week. He has been writing for The Week since the 2001 debut of the U.S. print edition and served as editor of when it launched in 2008. Harold started his career as a newspaper reporter in South Florida and Haiti. He has previously worked for a variety of news outlets, including The Miami Herald, ABC News and Fox News, and for several years wrote a daily roundup of financial news for The Week and Yahoo Finance.