U.S. Q1 economic growth higher but still lackluster

BY  | FROM  | 2017-06-30 14:52

U.S. real gross domestic product (GDP) increased at an annual rate of 1.4 percent in the first quarter of 2017, said the U.S. Commerce Department on Thursday, but it was still the worst performance since the second quarter of last year.

The growth rate was revised up from two previous gauges of 1.2 percent and 0.7 percent, according to the final assessment of the economy for the period issued by the Commerce Department.

The higher growth rate was mostly driven by unexpectedly higher consumer spending and a hike in exports.

Consumer spending, which accounts for two-thirds of the U.S. economic activities, increased by 1.1 percent in the first quarter, almost double the 0.6 percent last month, but remains the weakest reading since the second quarter of 2013.

U.S. exports growth rate for the period was also revised up to 7.0 percent from an earlier 5.8 percent.

Despite the upward revision to GDP, U.S. economic performance was still lackluster compared with other developed economies. The economic growth rate of the United States in the first quarter was only higher than that of Britain and Japan among G7 countries.

Also, in recent years the U.S. economy has tended to underperform in the first quarter relative to the rest of the year due to statistical issues. The government has said it is working to resolve those issues.

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