ECONOMY STRONGER THAN PREVIOUSLY THOUGHT!

DealersEdge.com---February 28, 2005

U.S. economic performance at the end of 2004 was significantly stronger than previously thought, according to a government report revising up fourth-quarter output to reflect stronger exports and investment. The Commerce Department said gross domestic product, the measure of total goods and services produced in the U.S., grew at a revised 3.8 percent annual rate in the final three months of last year instead of 3.1 percent reported a month ago. Nearly half the revision stemmed from a stronger trade performance, reflecting more robust exports than previously thought. Statistics Canada corrected a $1.4 billion error in underestimating U.S. exports to Canada during November, and later data also showed the U.S. trade deficit for December narrowed more than had been anticipated. Businesses kept up a brisk pace of new investment. Nonresidential investment climbed at a revised 14 percent rate instead of 10.3 percent reported a month ago and was ahead of the third quarter's 13 percent. Most analysts believe the economy has enough strength to keep expanding at around a 4 percent annual rate in the first half of 2005.