U.S. Economy Shrank in Fourth Quarter

The United States economy unexpectedly shrank during the last quarter of 2012, the Commerce Department said on Wednesday. Economic output during that quarter fell by 0.1 percent, marking the slowest rate of growth since the second quarter of 2009. In comparison, the economy experienced growth of 3.1 percent in the third quarter of 2012. The contraction was somewhat expected because of weaker exports, a drop in military spending, and a slower buildup of inventories, but it was worse than economists had predicted. Before the announcement, the general consensus was that the fourth-quarter growth was 1.1 percent. Economists warn that the slow growth has continued into the first quarter of 2013.