U.S. economy grew faster in fourth quarter 2011

The U.S. economy growth in fourth quarter 2011 was stronger than originally thought as consumers increased their spending and businesses stocked up their inventories.

Gross domestic product (GDP), the broadest measure of the nation's economy, grew at a 3% annual rate in the last quarter of 2011, the Commerce Department reported Wednesday. The government had initially reported the economy grew at a 2.8% rate, and economists had projected the GDP growth would be revised down to 2.7% from the initial reading.

That's the fastest growth since the second quarter of 2010 and a major improvement from a 1.8% growth rate in the prior quarter.

Consumer spending picked up at an annual rate of 2.1% in the fourth quarter, slightly higher than originally reported. Spending on durable goods, especially motor vehicles, helped drive GDP higher, as did increased spending at restaurants and hotels.

Meanwhile, businesses increased their inventories by $54.3 billion, after cutting back on their stock the prior two quarters.