By Jonathan Davies

The slowdown in the US economy at the end of 2014 was worse than initial figures suggested, according to the country's Commerce Department.

Initial estimates suggested the US economy grew by 2.6% in the final quarter of 2014, compared with the previous year. But new figures show that it grew by just 2.2%, compared with 5% in the previous quarter.

The Commerce Department said the revised slowdown was as a result of falling business inventory investment.

"The reason for the lack of concern is that the slowdown was due in part to a far smaller than previously estimated inventory build-up, in turn thought to be partly due to port strikes", said Chris Williamson, chief economist at Markit.

"The weaker stock build-up late last year bodes well for first quarter growth."

Earlier this week, chair of the Federal Reserve Janet Yellon, said the US economy was improving and that the Fed was relaxed and flexible over when interest rates would be increased.