Nearly two-thirds of the upward revision in GDP came from the boost in consumer spending, which accounts for about 70 percent of economic activity. Analysts were encouraged by the revised fourth-quarter estimate, saying it provided momentum for the rest of the year, when they expect growth to reach a stronger if still-modest 2 percent annual rate.
"Real economic growth was stronger than we thought late last year, and this makes us more hopeful that the first quarter will be better than expected," said Chris Rupkey, chief economist at MUFG Union Bank in New York.
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