The American economy grew at a 1.4% annual pace from January through March, a slight increase from the previously estimated 1.3%, marking the slowest quarterly growth since spring 2022. Consumer spending decelerated to a 1.5% rate, indicating the impact of high interest rates on the economy.
The first quarter’s growth is a significant slowdown from the 3.4% pace in the last quarter of 2023. The main factors for the slowdown were a surge in imports and a decrease in business inventories, which together shaved 1.24 percentage points off growth. However, business investment rose at a 4.4% annual pace, driven by increased investment in nonresidential buildings and intellectual property.
Despite the slowdown, the economy remained resilient, with consumer spending on services rising at a 3.3% rate, though spending on goods fell by 2.3%. Analysts are divided on future growth, with some expecting a continuation of modest growth due to high interest rates.
Tags: #USEconomy #EconomicGrowth #GDP #ConsumerSpending #BusinessInvestment #InterestRates
