Daily Management Review

Quarterly growth of US GDP turns out to be worse than forecasts


The first quarter saw a sharp slowdown in the expansion of the US economy. According to figures from the nation's Commerce Department, the US GDP grew by just 1.6% year over year at the conclusion of the first three months of the year.

klikk - Fotolia
klikk - Fotolia
This is far less than the 3.4% result from the previous quarter and far below the 2.4% prediction of analysts surveyed by the Wall Street Journal.

The study states that Americans continue to spend a lot of money on insurance, financial services, and health care. Nevertheless, consumer expenditure declined significantly, mostly on new and maintenance for cars, and a spike in imports reduced GDP growth by 1%.

The annual inflation rate in the United States increased from 3.2% to 3.5% at the end of March, according to data released earlier by the U.S. Labor Department. Prices grew by 0.4% on a monthly basis, compared to the 0.3% monthly inflation rate that economists had predicted.

source: wsj.com