Economy Grew 2.5 Percent In The First Quarter Of 2013

The American economy grew 2.5 percent in the first quarter of 2013, according to the latest data from the Commerce Department. Analysts had projected the economy would grow at a 3 percent rate during the first three months of 2013.

Growth is stronger than it was in the final quarter of 2012, when the economy expanded by 0.4 percent. Growth in the first quarter was slowed by drops in government spending, which declined by 8.4 percent. Defense spending decreased by 11.5 percent, non-defense declined by 2 percent. State and local government spending dropped by 1.2 percent.

Private consumption increased by 3.2 percent, larger than the 1.8 percent increase in the fourth quarter of 2012. Inflation remained low at 1.2 percent, well below the Federal Reserve’s 2 percent target rate.