WASHINGTON (AP) — The U.S. economy grew last year at the fastest pace since Ronald Reagan’s presidency, bouncing back with resilience from 2020′s brief but devastating coronavirus recession.
The nation’s gross domestic product — its total output of goods and services — expanded 5.7% in 2021. It was the strongest calendar-year growth since a 7.2% surge in 1984 after a previous recession.
The economy ended the year by growing at an unexpectedly brisk 6.9% annual pace from October through December as businesses replenished their inventories, the Commerce Department reported Thursday.
“It just goes to show that the U.S. economy has learned to adapt to the new variants and continues to produce,″ said Beth Ann Bovino, chief economist at Standard & Poor’s Global Ratings.
Squeezed by inflation and still gripped by COVID-19 caseloads, the economy is expected to slow this year.
Many economists have been downgrading their forecasts for the current January-March quarter, reflecting the impact of the omicron variant.
And for all of 2022, the International Monetary Fund has forecast that the nation’s GDP growth will slow to 4%.
Many U.S. businesses, especially restaurants, bars, hotels and entertainment venues, remain under pressure from the omicron variant, which has kept millions of people hunkered down at home to avoid crowds.
Consumer spending, the primary driver of the economy, may be further held back this year by the loss of government aid to households, which nurtured activity in 2020 and 2021 but has mainly expired.