U.S. Economy Grew 2.9% in 2018—Short of Trump’s Target

The U.S. economy expanded at a 2.9 percent pace last year—just short of President Trump’s target of 3 percent. Growth in the final quarter of 2018 slowed to 2.6 percent, after the 3.4 percent registered in the third quarter and 4.2 percent in the second, according to figures from the Commerce Department released Thursday morning. Trump has repeatedly said he can achieve 3 percent annual growth for the next decade, but the Federal Reserve is predicting 2.3 percent growth for 2019. “Last year was likely the best year of this business cycle,” said Ellen Zentner, chief economist at Morgan Stanley. “We stimulated the heck out of the economy last year and that stimulus will fade this year.” Last year’s growth marked the fastest gain for the economy since 2015, partly because Trump delivered a large corporate tax cut. However, that stimulus is widely expected to weaken this year, which may cause growth to slow in 2019.