Data out Thursday from the Commerce Department showed the country's gross domestic product - a measure of all goods and services produced - increased at an annualized rate of 3.3%. That blew past the estimate of economists polled by Reuters by more than a full percentage point.
Growth for the full year came in at two-and-half percent - also shattering predictions.
The country's strong economic performance has stunned captains of industry and some economists who predicted that some 18 months of aggressive rate hikes by the Federal Reserve, to bring down inflation, would throw the economy into a recession.
But, so far, that hasn't happened. And at the same time, the Fed's "medicine," as it's been called, appears to be working. Thursday's data also showed inflation pressures further subsided in the fourth quarter.
The economy's stamina reflects a resilient labor market, marked by strong wage gains, which has powered consumer spending.
U.S. Treasury Secretary Janet Yellen on Thursday touted the Biden administration's economic stewardship.
"The Biden administration has put in place the most extensive set of policies and investments to benefit the middle class and grow the economy. [FLASH] Put simply, it's been the fairest recovery on record. We see this in gains not only for the middle class Americans, but also across demographic groups such as the rapid decline in unemployment rates for black and Hispanic Americans."
In a separate report on Thursday, the Labor Department said initial claims for state unemployment benefits last week were just a touch above what economists had forecast.
Many investors had predicted the Fed would begin to lower interest rates in March. But the economy's strong performance suggests that may be too soon with May now a likelier target.
