Wednesday April 29, 02:03 PM
US economy slid at 6.1% in first quarter
WASHINGTON (AFP) - The US economy contracted at a 6.1 percent annual pace in the first quarter of 2009, the government said Wednesday, signaling little improvement in a deep recession.
The Commerce Department's first estimate of gross domestic product (GDP) was a disappointment to forecasters expecting a 4.7 percent decline, and marked only a marginal improvement over the 6.3 percent drop in the fourth quarter of 2008.
The decline marked the third consecutive quarter of contraction for the world's biggest economy, which had not occurred since 1974-1975.
The steep fall was the result of falling exports, declines in business and household investment and a weak housing market, offset in part by improved consumer spending.
Consumer spending rebounded in the quarter, growing 2.2 percent after falling 4.3 percent in the last quarter of 2008.
But even though consumer activity makes up the lion's share of activity, it was not enough to offset hefty declines in other segments of the economy.
Investment in housing or residential structures fell 38 percent and spending on nonresidential business investment slumped 37.9 percent including a 33.8 percent drop in software and equipment.
Exports tumbled 30 percent and even government investment fell 4.0 percent.
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