US Economy Hale and Hearty At End of 2003

20 January 2004

Disappointing employment news notwithstanding, the US economy saw out the old year in robust style, according to a series of reports published Friday.

Consumer confidence rose in December to its highest level since late 2000, while industrial production also rose for the fourth consecutive month. And businesses increased their inventories in response to improving sales.

Said Bear Stearns economist John Ryding: "The economy is still in very good shape, and it is continuing to improve into the early part of this year." Macroeconomic Advisers of St. Louis was in similar bull mode, quoting the consensus view of ten economists that gross domestic product grew at an annual rate of 4.3% in the fourth quarter.

Nor did the latest data from the University of Michigan's consumer sentiment index rain on anybody's parade. This rose to 103.2 in early January from 92.6 in December -- above the consensus estimate and the best reading since November 2000.

Finally, the Federal Reserve reported industrial production up 0.1% in December which, although a deceleration from November's 1% gain, was the fourth successive monthly increase. Manufacturing output rose 0.3%.

Data sourced from: The Wall Street Journal Online; additional content by WARC staff