Is U.S. economy strong enough?

Thursday's GDP and jobless claims reports were projected to have a modest impact on market's movement, even despite the fact that they give an insight on what is happening with the key labour market and at what pace the economy is developing. It seems that the Federal Reserve was already aware of the data when it took decision to trim down monthly purchases further. Therefore, even GDP report gives little information about possible future actions from the Fed, as they have already signalled further cuts.

Nonetheless, the fourth quarter growth came in line with analysts' forecasts, as economy benefited from higher household spending and trade receipts, which both posted strongest gains in three years. The world's largest economy expanded 3.2% in the final quarter, losing momentum from the third quarter, when growth stood at 4.1%. Meanwhile, the expansion is likely to pick up and at least stay above 3%, as drags from fiscal policies and political disputes dissipate after the Congress passed the budget, diminishing hopes of another shutdown. American families bought 3.3% more goods and services, while purchases of long-lasting goods remained little changed. The main drag, however, become business investment, which exacerbated fewer spending made by the U.S. government. Also Thursday, the Labor Department said the number of initial jobless claims rose 348,000 last week, coming below analysts' expectations.