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US economy grows at snail’s pace in first quarter, expands 0.1%

Published time: April 30, 2014 17:05
Reuters / Enrique Castro-Mendivil

Reuters / Enrique Castro-Mendivil

The US economy came to a near standstill in the first quarter of 2014, growing at one of its weakest paces since 2012. The slow growth could indicate that America's post-recession honeymoon is over.

Gross Domestic Product (GDP), or the total sum of all goods and services produced within the USA, only advanced 0.1 percent in the first three-month period of 2014, the Commerce Department said on Wednesday.

The report is a preliminary estimate and can be revised significantly, either up or down.

Economic momentum slowed down due to the effects of extreme winter weather, as well as a decrease in business spending. Exports fell at a rate of 7.6 percent in the first quarter – the biggest fall since the recession ended. The frigid weather could be to blame for less consumer spending, which only increased at a rate of 0.4 percent.

The slowdown is in stark contrast to the 3.4 percent economic expansion that the US enjoyed in the second half of 2013.

“We’ve been living in sub-3 percent land, and people have gotten used to that as the new normal. But it's not. It's anemic,” Dan North, chief economist at Euler Hermes North America, told The New York Times.

America's economy slowed drastically in the first quarter of 2014, as wintry weather depressed corporate spending and housing sector activity. Smaller additions to inventories by farmers and businesses also held back growth.

Business spending dropped 2.1 percent between January and March, as companies spent less on buildings, equipment, and intellectual property.

Federal spending is set to grow in 2014, which could help offset the lackluster first quarter growth. Most economists are predicting an overall growth of between 2.5 and three percent.

Later on Wednesday, the Federal Reserve will finish its two-day meeting and will likely announce another $10 billion in monthly bond purchases as part of its planned 'tapering’ of stimulus spending.

Comments (5)


Nickita 05.05.2014 01:18

America forcing militarily or politicaly other countries, preferably natural reserves reach countries, to share/privatize their resouces but. Now invading Lithium rich Afganistan to pump cells.

Aver age american car driven mostly alone, last 20 years (3 tones, 8.cyl OHV GM, 5800 ccm with consumption of 16-25L / 100km) is mega waste of resources, yet and now u hunt and demand reserves worlwide to retain your early standards. Minor acceptance/change is needed, to regain ethics respect.

Is even possible in this world to gain success without harming others?


shars 30.04.2014 21:15

mihaita azar 30.04.2014 18:23

All these statistical lies just to justify the illegal occupation of the Crimea. Any economic statistic on Russia? oh yes not forthcoming, right forgot?


Look it up yourself if it bothers you so much. RT has reported on how the IMF has continually stated how bad RF's GDP would fall plus Russian officials have reported how low their GDP could get.

But low and behold, nothing was ever reported by the IMF how low U.S. or EU would be. LOL


Eric Daniels 30.04.2014 17:31

My country are college educated idiots sad to say. I'm a high school grad and I could tell them exactly where they went wrong and continue to go wrong. Will they listen to me? Of course not. Therefore let them continue to look at excel spreadsheets for answers they will never find.

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