The U.S. economy barely grew at all in the first quarter as harsh winter weather chilled investment and exports dropped. The stall occurred even as consumer spending on services rose by the most in 14 years.
Gross domestic product grew at a 0.1 percent annualized rate from January through March, compared with a 2.6 percent gain in the prior quarter, figures from the Commerce Department showed today in Washington. The median forecast of 83 economists surveyed by Bloomberg called for a 1.2 percent increase. Household purchases rose at a 3 percent pace, spurred by utility outlays and spending on health care tied to President Barack Obama’s Affordable Care Act.
The expiration of emergency unemployment aid for about 1.6 million job-seekers may also have weighed on consumer spending in the first quarter. At the same time, a pickup in health spending and a boost in household incomes came as major provisions of the President’s signature health-care law took effect.