America’s economy outperformed expectations during the first three months of 2018, according to Commerce Department figures released Friday.
The Gross Domestic Product, the total output of goods and services, rose 2.3 percent from January through March, topping the expected 2 percent growth in the first three months of the year, CNBC reported.
— Maria Bartiromo (@MariaBartiromo) April 27, 2018
The first quarter did represent a cooling off from the three quarters that preceded it, in which economic growth was at 3 percent for each of the two quarters and then 2.9 percent in the fourth quarter of 2017. The numbers released Friday are an estimate that will be revised later in the year.
The pace is expected to pick up in the next quarter and top the Trump administration’s goal of 3 percent growth.
In reporting about the GDP figures for Marketwatch, Jeffrey Bartash wrote, “The economy already shows signs of speeding up again after the usual winter lull, though it will take a few more weeks to get a better read.”
“A spring rebound would fit a longstanding pattern,” he wrote, later adding, “What’s greasing the skids for the economy is a roaring labor market, rising pay and higher business investment. The recent Trump tax cuts have added another boost.”
I fully expect this 1st Q 2.3% GDP estimate to be revised upward although it beat the expected 2% growth. The 1st Q historically is the lowest: .6% in 2016 & 1.2% in 2017. So it's almost double last year. Trump's magic wand continues to impress.https://t.co/9Wr7JxUvDY
— ⭐?⭐LOUDOG ⭐?⭐ (@LouisTabor3) April 27, 2018
The first quarter often has slower economic growth than the rest of the year, The New York Times reported. It suggested that winter weather could have limited spending, and that data reporting procedures could also be at work, making the first quarter results seem weaker than the reality of the economy.
The economy continues to be a highlight for Trump.
Q1 GDP of 2.3% is better than expected, especially since Q1 is typically the weakest of the year.
Economy growing for right reasons: strong consumption and more business investment https://t.co/00d9nD9E8W pic.twitter.com/OFJAHFQdXN
— Heather Long (@byHeatherLong) April 27, 2018
“There’s a little weakness in Q1 and then the other quarters are artificially inflated because of that,” said Kathy Bostjancic, chief United States financial economist at Oxford Economic.
Carl R. Tannenbaum, the chief economist of Northern Trust in Chicago, said a lower growth rate had been expected, but that the experts, “yet maintain optimism for the remainder of the year.”
“The trend is probably better than what you’re seeing,” economist Jim O’Sullivan of High-Frequency Economics told The Washington Post. “Quarterly data are volatile. You never want to get too caught up in a single number.”
“The first quarter has been persistently weak in recent years,” David Sloan, senior economist at Continuum Economics, had said before the report was issued, according to Investors.com. “We expect a rebound. Tax cuts will support consumer spending and business investment,” while “trade is certainly a risk.”
In announcing the first quarter results, the Bureau of Economic Analysis said in a news release that factors limiting GDP growth included personal consumption, investments by homeowners in big-ticket items, exports, and spending by state and local governments. On the bright side, the BEA reported, there was an increase in private sector spending to bolster inventories.
The first quarter of 2018 was being watched for the impact of the tax cuts that were proposed by President Donald Trump and passed by Congress in late 2017.
The Post reported that the impact of those cuts is most likely to be evident in the second quarter because revised withholding allowances were not fully in effect for the first quarter.
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