The economy shrank at an annual rate of 0.1 percent in the October-December quarter, hurt by a sharp cut in defense spending, fewer exports and sluggish growth in company stockpiles. That was much worse than the 3.1 percent growth recorded in the July-September period.

But economists predict that the October-December growth figure will be revised Thursday to show a small increase, after exports jumped unexpectedly in December. Economists now forecast that the government will report a fourth quarter expansion of 0.5 percent.

Growth will likely pick up a bit in the January-March quarter to an annual rate of 1.5 percent, analysts forecast. That's better than the fourth quarter but below last year's expansion of 2.2 percent.

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