U.S. Economy Contracted 0.7% in First Quarter

By Published on May 29, 2015

The economy got off to an even weaker start this year than first thought, the government reported Friday, as economic activity contracted amid a disappointing trade picture and continued caution on spending by businesses and consumers alike.

The 0.7 percent decline in economic output in the first quarter of 2015 was a reversal of the initial 0.2 percent advance for the period reported last month by the Commerce Department.

While statistical quirks and one-time factors like wintry weather in some parts of the country played a role, as did a work slowdown at West Coast ports, the lackluster report for January, February and March underscores the American economy’s seeming inability to generate much momentum.

Much of the revision was spurred by fresh data showing businesses added to inventories at a slower pace than first estimated, while net exports fell slightly more than first thought. A sharp pullback in energy exploration in the wake of falling oil prices is also putting pressure on business investment.

Read the article “U.S. Economy Contracted 0.7% in First Quarter” on nytimes.com.

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