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Higher oil prices also weigh on the U.S. economy by increasing the costs of moving goods and filling up gas tanks. A sustained $10 increase in the price of oil translates into a 0.2 percent cut in economic growth over 12 months, according to a recent estimate by economists at Goldman Sachs. Treasurys inched up Friday on reports the economy grew more slowly than first thought in the last three months of 2010. The yield on the 10-year Treasury note edged down to 3.42 percent from 3.46 percent late Thursday. The Commerce Department said the economy expanded at an annual rate of 2.8 percent in the October-December quarter. That's weaker than the previous estimate of 3.2 percent. In an attempt to close budget gaps, state and local governments have cut spending much more deeply than previously thought. Despite this week's slide, the S&P 500 is up 2.6 percent in February and 4.9 percent for the year. Stronger earnings from a wide range of companies, including Archer Daniels Midland Co. and Dell Inc., have helped drive stocks higher. Five stocks rose for every one that fell on the New York Stock Exchange. Consolidated volume was 3.9 billion shares.
[Associated
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