"The fourth quarter turned out to be not as strong as initially estimated. Fourth quarter GDP growth was revised down to 2.8 percent annualized growth from the advance estimate of 3.2 percent," according to Bloomberg. The report said "The new figure fell short of analysts' forecast for 3.4 percent. However, the fourth quarter was still marginally healthier than the third quarter pace of 2.6 percent.

The downward revision to the percent change in real GDP primarily reflected an upward revision to imports (less negative) and downward revisions to state and local government spending and to personal consumption expenditures that were partly offset by an upward revision to exports.

Notably, demand numbers were revised down somewhat. Final sales of domestic product were bumped down to 6.7 percent from the initial estimate of 7.1 percent. Final sales to domestic purchasers (takes out net exports) were nudged down to 3.1 percent from the original estimate of 3.4 percent for the fourth quarter.

Separate from the direction of revisions, some components in absolute strength are relatively healthy. PCEs came in at an annualized 4.1 percent, compared to 2.4 percent in the third quarter. Nonresidential fixed investment gained 5.3 percent in the latest period, residential investment rose modestly, and net exports improved sharply. In contrast, inventory investment slowed significantly, slicing off 3.7 percentage points from GDP growth. And government purchases declined slightly.

Year-on-year, real GDP in the fourth quarter is up 2.7 percent, compared to 3.2 percent in the third quarter.

On the inflation front, the GDP price index was little revised, coming in at 0.4 percent, compared to the initial estimate of 0.3 percent. The market median forecast was for 0.3 percent. However, the recent spike in oil prices makes the fourth quarter numbers basically irrelevant.

Today's report is a disappointment as equity futures eased a bit on the news though remained notably positive. The still moderate growth in the economy certainly explains currently sluggish growth in employment. But more recent monthly data show the recovery continuing, albeit at a moderate pace."