U.S. economic growth decelerated in the fourth quarter but still grew at a solid rate, powered by an uptick in consumer spending.

The Gross Domestic Product grew at an inflation-adjusted annual rate of 2.3% in the first quarter, the Bureau of Economic Analysis said Thursday in a preliminary estimate. That was a deceleration from 3.1% growth in the third quarter and slightly below the consensus estimate for 2.5% growth, according to a survey of forecasters by Dow Jones Newswires and The Wall Street Journal.

Despite the downtick, overall growth for the year showed the economy was on solid footing, growing 2.8% in 2024, down a tick from 2.9% in 2023. Business investment and inventories decreased in the fourth quarter, dragging down the overall quarterly figure. However, government spending increased, and so too did consumer spending, which is the main engine of growth, suggesting the economy still has plenty of momentum as it transitions into the Donald Trump presidential era.

"Overall, this was a decent GDP report that shows the U.S. economic expansion is still on a pretty firm footing right now," Scott Anderson, chief U.S. economist at BMO Capital Markets, wrote in a commentary.

Consumer spending rose 4.2%, the biggest surge since the first quarter of 2023. Meanwhile, private domestic investment fell 5.6%, the first decrease since the first quarter of 2023.