U S Economy

The blizzard that crippled the East Coast this week will probably affect retail sales for January and hurt the overall economy to some degree, Commerce Undersecretary Everett Ehrlich said Wednesday. But the impact could be partially offset by increased purchases of snow-removal equipment and home-related activities, he said. "I would presume that the snowstorm has a negative effect on GDP [gross domestic product] simply because it reduces economic activity," Ehrlich said.

The U.S. economy, hammered by two government shutdowns, almost screeched to a halt at the end of last year, eking out its weakest economic growth rate since the last recession, the government reported Friday. The Commerce Department report, which adds fuel to the debate over the nation's growth potential and federal policies to promote it, shows the economy creeping forward at a 0.9% rate in the last three months of 1995.

New evidence arrived Wednesday that the American economy was heating up, thanks to confident consumers and improving housing and job markets. And workers are benefiting through higher wages. The Commerce Department reported Wednesday morning that inflation-adjusted economic growth surged to 3.5% during the fourth quarter, up from 2% in the previous quarter and above average for an expansion.

Wall Street stocks closed higher Friday, aided by hopes that the U.S. economy has bottomed but tempered by selling each time an Iraqi missile slammed into its target in the Persian Gulf War. The Dow Jones industrial average closed up 16.34 points, or 0.6%, at 2,659.41, finishing the week with a net gain of 12.63 points. As had been the trend all week, smaller stocks generally performed better than the Dow: The NASDAQ over-the-counter composite index rose 2.95 points, or 0.8%, to 394.28.

For months, the climate has seemed ominous: a fierce financial storm overseas, the ballooning trade deficit, stock market turbulence, fears that credit will dry up. Together, they paint a picture of hard times ahead. But consider a drastically different reality, the one that most Americans continue to experience in their daily lives: Employment bristles at record heights, incomes are rising, inflation remains benign, interest rates are nestled at modest levels.

U.S. businesses ran at their fastest operating rate in more than 2 1/2 years in September while new-home building climbed sharply in renewed signs of economic vigor, separate reports on Friday showed. The Federal Reserve Board said production by the nation's factories, mines and utilities gained 0.7% last month--more than double the 0.3% gain anticipated by Wall Street economists--pushing the capacity use rate up to 84.4% from 84.1% in August. That was the fastest operating rate since 84.

WASHINGTON Like a centenarian on steroids, America's economic boom is closing in on the longevity record with no sign of slowing down. Unless something goes unexpectedly haywire, next January it will become the longest upswing in U.S. history. Is it a freak, the economic equivalent of a 100-year flood? A growing number of experts think not.

WASHINGTON - Europe's recession stretched into the first three months of the year, making it the single-currency region's longest downturn and raising concerns about its effect on the U.S. recovery. The 17-nation Eurozone economy contracted 0.2% in the first quarter compared with the previous quarter, according to data released Wednesday by Eurostat, the region's statistical office. It was the sixth straight quarter of contraction, exceeding the five-quarter recession from 2008-09.

WASHINGTON -- Global finance leaders agreed that nations must take stronger action to spur still-lagging and uneven economic growth and job creation. And they had a pointed message for the U.S.: For the sake of the rest of the world, address your longer-range budget debt situation.  In a joint communique and in individual statements at the conclusion of the International Monetary Fund's spring meetings Saturday, finance ministers and central bankers called on Washington to develop a credible plan to deal with its spending and debts over the next several years.