us economic growth cooled to a 29 annual rate in the fourth quarter capping a year of high inflation and rising interest rates us gross domestic product at the end of the year was down slightly from a 32 annual rate in the third quarter the commerce department said thursday the three months from october to december capped a year of economic cooldown from a rapid pandemic rebound that fueled redhot growth in 2021 economic output grew 1 in the fourth quarter of 2022 compared with a year earlier the commerce department said that compares with 57 growth in 2021 and 26 growth in 2019 ahead of the pandemic at least some of the 2022 slowdown reflected a return to a more normal pace of growth after output surged amid pandemic reopenings fiscal stimulus and a waning pandemic the year before consumers the economys main engine spent at a solid pace of 21 in the final three months of last year business investment and government spending also contributed to growth last quarter despite signs of resilience many economists are concerned about the possibility of a us recession this year they expect the federal reserves efforts to curb high inflation through rapid interestrate increases will trigger broad spending cutbacks and job losses headwinds from the big jump in interest rates consumers cutting back on discretionary spending and weak economies overseas were big problems for the us in late 2022 said bill adams chief economist for comerica bank i expect real gdp growth will likely turn negative in the first half of this year recent surveys of us purchasing managers found that higher interest rates and persistent inflation weighed on demand in january in the manufacturing and service sectors parts of the economy also showed signs of cooling at the end of last year retail sales fell last month at the sharpest pace of 2022 existinghome sales fell for the 11th straight month and hiring and wage growth eased