The US economy grew at an annual rate of 2.9% in the fourth quarter

“Resilience is a good thing in many ways, but it also makes things harder for the Federal Reserve and strengthens its resolve,” said Diane Swonk, chief economist at accounting firm KPMG.

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There are signs that consumers may finally be reaching their limits. Americans have saved less and used credit cards more frequently in recent months as pandemic-era savings dry up. Retail sales have fallen for two straight months and a large inventory build in the fourth quarter suggests many businesses may have sold less than expected over the holiday season.

“You’re starting to see the cracks here,” says Brett Ryan, senior economist at Deutsche Bank.

In some corners of the economy, these cracks are more like cracks. Residential construction in particular was hit hard by rapidly rising interest rates. Housing activity contracted at an annual rate of 26.7 percent in the fourth quarter, capping the worst year since the subprime mortgage crisis 15 years ago. It was a striking reversal from earlier in the pandemic when housing was booming.

“It was such an abrupt thing — I think it turned everyone’s head,” said Gene Myers, chairman of Thrive Home Builders in Denver. “I think there’s some kind of whiplash.”

Mr. Myers had expected to complete the sale of about 150 homes over the past year. He ended up closing 83. “Our demand just dried up,” he said.

So in November, Mr. Myers took action, laying off workers, negotiating lower prices with contractors, and slashing home prices by about 15 percent. There are signs the strategy has worked: Thrive has sold eight homes so far this year, which Mr. Myers sees as a sign buyers are waiting for the right price and not giving up home ownership altogether.

“I feel like people wake up after the holidays and they’re like, ‘The sky hasn’t fallen, I’m still employed and I’m sick of renting. Let’s take a look,'” he said.