The US economy expanded again during the fourth quarter, registering solid growth even as consumers and businesses battled inflation and historically high interest rates. But N.C. State economist Dr. Michael Walden is sticking to his recession forecast.

“Not a surprise the quarterly rate was positive,” Walden told WRAL TechWire.

“It came in higher than expectations, but was lower than the third quarter rate.  Hence, the lower positive rate in the fourth quarter compared to the third quarter indicates economic activity is slowing, but not contracting.”

Gross domestic product — the broadest measure of economic activity — increased at an annualized rate of 2.9% from October to December last year, according to Commerce Department data released Thursday.

That’s a slowdown since summer, when the economy saw growth of 3.2% in the third quarter — but an improvement on the first half of the year, which showed two consecutive quarters of contraction.

“So were are not in a recession now,” Walden said. “However, the new report does not change my forecast of a high probability of a recession in the second half of this year.   But, if a recession does occur, it will be “short and mild.”

Economists were expecting fourth-quarter GDP to grow at an annualized adjusted rate of 2.6%.

For 2022, GDP expanded 2.1%, according to the Commerce Department report.