The U.S. economy entered 2017 with a solid head of steam, driven by consumer spending and a pickup in business investment. President Donald Trump could add to that momentum — or kill it, if trade tensions keep flaring.
Fourth-quarter figures released Friday showed how swings in trade can have big effects. Net exports subtracted 1.7 percentage points from the gross domestic product, the most since the second quarter of 2010. The wider trade deficit followed a spike in soybean shipments that boosted exports in the July-to-September period.
The drag from trade limited the increase in gross domestic product, the value of all goods and services produced, to an annualized rate of 1.9 percent, less than analysts projected. Continued gains in household purchases, the first advance in business-equipment spending in five quarters, and accumulation of inventories contributed to growth.