The U.S. economy grew at a 1.9 percent pace in the last three months of 2016.
Friday's report from the Commerce Department is lower than most economists expected.
The Gross Domestic Product is the sum of all the goods and services produced in a nation and is the broadest measure of economic health.
The U.S. GDP expanded 1.6 percent in 2016, which is less than the prior year.
The world's largest economy is in "decent, if unspectacular" shape according to PNC economist Gus Faucher. He says consumer spending is growing steadily due to job gains and wage growth, which will help the economy expand this year. Efforts to cut taxes and regulation could also help by boosting business investment. PNC predicts the U.S. economy will grow about 2.4 percent in 2017.
Economists at Wells Fargo say possible increases in government spending on the military and infrastructure could boost growth, but caution that more spending could push up inflation, which may prompt the U.S. central bank to raise interest rates. The Fed's effort to cool inflation might also cool growth.
Initial GDP estimates may be revised over the next two months as more complete data becomes available.