The U.S. economy expanded a little faster at the beginning of the year than previously estimated. But the pace was still anemic and economists don’t see that changing until later this year, The Associated Press reports.
The Commerce Department on Friday said the economy grew at an annual rate of 1.9 percent in the January-March quarter. That’s not much better than the 1.8 percent rate estimated a month ago. The small upward revision reflected stronger exports and more business spending on stockpiles.
High gas prices were a major reason growth slowed. The impact of those prices is expected carry over into to the current quarter. The economy is growing in the current April-June quarter at a rate of about 2.3 percent, according to an Associated Press survey of 38 top economists.
Economic growth must be stronger to make a noticeable dent in unemployment, which was 9.1 percent last month. The economy would need to grow 5 percent for a whole year to significantly bring down the unemployment rate. Economic growth of just 3 percent a year would hold the unemployment steady and keep up with population growth.
A parts shortage stemming from the March 11 earthquake and tsunami in Japan is another reason economists expect sluggish growth this spring. But those supply disruptions may be easing.
