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Growth could slow later this year. Much of the fourth quarter’s expansion was due to companies ordering more goods to restock their warehouses. Restocking is likely to slow in the first three months of this year, and that would bring down growth.
Europe’s financial crisis could also slow demand for U.S. goods. And average wages failed to keep up with inflation last year. That leaves Americans with less spending power, which can hamper growth.
But many analysts are optimistic. Jennifer Lee, an economist at BMO Capital Markets, said she expects the economy to expand at a 2.5 percent annual clip in the first quarter, up from an earlier estimate of 2 percent.
There is optimism among business leaders, too. Lanham Napier, CEO of Rackspace Hosting, a San Antonio company that hosts and maintains corporate websites, said his company hired about 650 people last year and plans to add roughly as many this year.
Napier said his company’s clients are spending about 10 percent more than a year ago because their businesses are picking up. When online retailers receive a crush of sales, for example, they pay Rackspace for more computer capacity.
"We’re making more money than we’ve ever made," Napier said. "We’re optimistic about 2012."
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