US GDP sees shock contraction in Q4

The first official reading of US GDP revealed GDP dropped by 0.1% in the final quarter of 2012, its first contraction since 2009. The reading confounded economists' expectations of a 1.1% rise on the quarter. Spending on defence fell by the largest amount since 1972, according to the Bureau for Labor Statistics, while a reversal in business inventories knocked 1.3 percentage points off the headline figure. Other figures suggest a greater resilience, with consumption growth still healthy at an annualised rate of 2.2%, leading some to retain their optimism. Capital Economics' chie...