US economy grows by 3.2% in the first
quarter, topping expectations, by Fred Imbers, 4/26/19.
First-quarter gross
domestic product expanded by 3.2%, the Bureau of Economic Analysis said in its
initial read of the economy for that period.
Economists polled by
Dow Jones expected the U.S. economy increased by 2.5% in the first quarter.
Gross domestic product
for the first quarter was the best start to a year since 2015.
First-quarter gross
domestic product expanded by 3.2%, the Bureau of Economic Analysis said Friday
in its initial read of the economy for that period. Economists polled by Dow
Jones expected growth of 2.5%. It was the first time since 2015 that
first-quarter GDP topped 3%.
“The upside beat was
helped by net trade (exports jumped while imports contracted sharply) and
inventories which combined contributed almost 170 bps of the rise,” wrote Peter
Boockvar, chief investment officer at Bleakley Advisory Group. “Personal
spending though, the biggest component was up just 1.2%, two tenths more than
expected as an increase in spending on services and nondurable goods offset a
decline in spending on durable goods.”
Exports rose 3.7% in the
first quarter, while imports decreased by 3.7%. Economic growth also got a lift
from strong investments in intellectual property products. Those investments
expanded by 8.6%.
Disposable personal
income increased by 3%, while prices increased by 1.3% when excluding food and
energy. Overall prices climbed by 0.8% in the first quarter.
Friday’s data was the
first look at how the economy fared during the longest government shutdown in
history. The federal government ceased operations for 35 days between late
December and Jan. 25 amid a standoff between the Trump administration and
congressional Democrats over funding for a wall along the U.S.-Mexico border.
Investors were closely
watching for the report as they looked for more confirmation that a recession
may not be in the cards over the short term.
The report “helps offset
fears of slowing global growth,” said Alec Young, managing director of global
market research at FTSE Russell. “At a time of lingering U.S.-Chinese trade
uncertainty and weak economic data everywhere from Germany to Korea to Japan,
strong U.S. data acts as an insurance policy against further global economic
weakness. And with inflation still subdued, it’s too early to start worrying
about Fed rate hikes again.”
Norb Leahy, Dunwoody
GA Tea Party Leader
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