Reply #53: U. S. first-quarter growth slows, inflation surges [View All]

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http://in.reuters.com/article/2011/04/28/idINIndia-56635820110428?type=economicNews

(Reuters) - U.S. economic growth slowed more than expected in the first quarter as higher food and gasoline prices dampened consumer spending, and sent a broad measure of inflation rising at its fastest pace in 2-1/2 years.

But the pull back in output, which was also the result of harsh winter weather, a widening trade gap as well as weak government spending, will probably be fleeting given a firming labor market.

Growth in U.S. gross domestic product -- a measure of all goods and services produced within U.S. borders -- braked to a 1.8 percent annual rate after a 3.1 percent fourth quarter pace, the Commerce Department said on Thursday. Economists had expected a 2 percent growth pace.

"We hit a bit of a soft patch in the first quarter, but that should prove temporary because weather was a drag and we got blindsided a bit by a jump in gasoline prices late in the quarter," said Ryan Sweet, a senior economist at Moody's Analytics before the report was released.