America’s economy grew during the first quarter, but at a slower 1.3% pace that was the weakest quarterly rate since early 2022, said the Commerce Department. The agency had previous predicted that the U.S.’s gross domestic produce had expanded at a 1.6% rate.
The sluggish growth pace last quarter can be attributed mostly to two factors: a reduction in business inventories and a surge in imports, which subtracted more than 1 percentage point from last quarter’s growth. Business inventory reduction took off almost a half of a percentage point.
Consumer spending also rose during the same time period, but not as much as expected. This could be an indication that the persistently high interest rates and ongoing inflation concerning are limiting household budgets. However, services spending grew at a 3.9% rate, the highest since mid-2021, and growth in business investment tacked more than 1 percentage point to Q1 growth.
