U.S. economy posts best growth best since 1984

The U.S. economy last year posted its best annual performance in nearly four decades .

In fact, the last time the economy grew at this pace, Ronald Regan was president, Los Angeles hosted the Summer Olympics and Bruce Springsteen had just released “Born in the U.S.A.”

The Commerce Department said Thursday the economy expanded at a 6.9% annualized rate in the final three months of the year --- triple that of the pace of the third quarter.

Fueling that growth: massive fiscal stimulus and very low interest rates that helped drive consumer spending that in turn pushed businesses to replenish depleted inventories. But that robust expansion supports the Federal Reserve’s pivot to raise rates in March …

… and the markets got upset Wednesday with Fed Chair Jerome Powell’s hawkish comments after the central bank’s policy meeting.

“In light of the remarkable progress we've seen in the labor market and inflation that is well above our 2% longer run goal, the economy no longer needs sustained high levels of monetary policy support. That is why we are phasing out our asset purchases and why we expect it will soon be appropriate to raise the target range for the federal funds rate.”

But the momentum appears to have faded by December. The onslaught of Omicron infections disrupted activity at factories and services businesses and crimped spending.

Still, the economy is expected to soldier on this year, with growth estimated as high as 3.9%.