U. S. economic expansion slowed in the first quarter of 2024 as consumers, tired of inflation, tightened their belts and spent less, the government reported Thursday.
Figures released by the Bureau of Economic Analysis show that gross domestic product grew an annualized 1. 6% in the first three months of the year, after growing 3. 4% in the fourth quarter of 2023.
The government’s initial estimate is well below expectations, with economists polled through FactSet forecasting a 2. 2% GDP expansion last quarter.
“The momentum of expansion is obviously wasting steam due to the breakneck speed of the second half of last year and, although the United States exception story remains intact, we are starting to see cracks in the hard data. “
Personal spending rose 2. 5% and core inflation rose 3. 7% in its first quarterly increase in a year, the knowledge showed.
The figures will be released ahead of the Federal Reserve’s policy consultation next week. While the central bank is expected to keep interest rates at their point in two decades, the latest insights may delay long-term cuts.
“This is an attractive combination of data signals, and the end result is higher United States yields, lower stocks and a stronger dollar,” said Kyle Chapman, currency analyst at Ballinger GroupArray.
Illustrating an economic slowdown amid stubborn inflation caused stocks to fall sharply on Thursday morning, with benchmark indices falling more than 1%.
Quotes were delayed by at least 15 minutes.
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