US growth reduces to 2.8pc

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WASHINGTON, Feb 26 (BBC): The US Department of Commerce has unexpectedly cut its estimate of fourth-quarter growth to an annualised 2.8 per cent, from 3.2 per cent previously. Analysts had instead expected the figure to be revised up slightly to 3.3 per cent. Lower government spending than previously estimated was the main reason for the downward revision. Economic growth for the whole of 2010 was also revised down slightly, from 2.9 per cent to 2.8 per cent. As well as lower state and local government spending during the final three months of last year, consumer spending grew at a slower rate than previously estimated. Despite the downward revision, Wall Street gained ground in early trading, with the Dow Jones index rising 42 points to 12,110 as the price of oil retreated from the two-and-a-half year highs seen Thursday.