Washington: The US economy grew at an annual rate of 2.3 per cent in the first quarter of the year, lower than the 2.9-per cent growth rate in the previous quarter, the US Commerce Department reported on Friday.
The deceleration of growth in the first quarter mainly reflected a slowdown in personal consumption expenditures, residential fixed investment, exports, and state and local government spending, Xinhua reported citing the US Commerce Department.
Personal consumption expenditures, which account for more than two thirds of the overall economy, grew at an annual rate of 1.1 per cent in the first quarter, down from 4 per cent in the previous quarter.
It seems that Americans were reluctant to increase spending in the first quarter, despite the US Congress passed a $1.5-trillion tax cut package by the end of last year.
The personal saving rate was 3.1 per cent in the first quarter, compared with 2.6 per cent in the previous quarter, according to the department.
Non residential fixed investment, a measure of corporate spending on structures and equipment, grew at 6.1 per cent in the first quarter, down from 6.8 per cent in the previous quarter.
Residential investment was also flat in the first three months of the year, possibly due to winter storms and higher short-term interest rates, according to analysts.
While the Donald Trump-led administration has vowed to accelerate annual US economic growth to over 3 per cent, the Federal Reserve last month expected US economy to expand at 2.7 per cent for the whole year 2018.