The latest gross domestic product report came in Thursday morning. It showed that last year ended with a moderating growth rate in the fourth quarter. But overall, GDP was strong in 2024, coming in at 2.8% compared to 2.9% in 2023.

The report says the continued vigor is mostly thanks to you, the consumer. Because consumer spending rose 4.2% in the fourth quarter, the fastest pace since early 2023.

When economist John Leer at Morning Consult looked at the GDP report, his eyes went straight to the breakdown of goods versus services. “It’s more about sort of the pie getting bigger and less about, you know, reallocating from goods to services or services to goods,” he said.

Leer said both spending categories fueled GDP growth in the fourth quarter. “It underscores the strength of the consumer,” he said.

Consumers are still doing all the things — shopping, vacationing, going out to eat, despite high interest rates.

One take: Maybe rates should have peaked higher to really slow down spending. “The monetary policy hasn’t been as tight as people thought it was,” said Dartmouth College economist Andrew Levin.

It’s not like high interest rates haven’t tempered spending at all. But many Americans are benefiting from gains in wages, stocks and home values.

“Enough other things have happened that, in fact, the positives for growth have outweighed that important negative,” said Jim Wilcox, an economist at the University of California, Berkeley.

High borrowing costs haven’t soured consumers. In fact, Wilcox said, a certain segment of Americans are sitting really comfortable.

“And not only that, another powerful effect on consumer spending is how wealthy people feel,” he said.

In other words, if your 2.5% mortgage rate means you’re paying hundreds of dollars a month less than your new next-door neighbor, why not take the family out for ice cream tonight?