Fourth Quarter Saw Biggest GDP Decline in 26 Years

NEW YORK ( -- The U.S. economy suffered its biggest slowdown in 26 years in the last three months of 2008, according to the government's first reading about the fourth quarter released Friday. Gross domestic product, the broadest measure of the nation's economic activity, fell at an annual rate of 3.8% in the fourth quarter, adjusted for inflation. That's the largest drop in GDP since the first quarter of 1982, when the economy suffered a 6.4% decline. Still, the decline was less than the 5.5% drop forecast by economists surveyed by The fourth quarter plunge followed a more modest decline of 0.5% in the third quarter.

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