A report from
the Commerce Department revealed on
Thursday that the U.S. economy shrank
slightly less than initially estimated in the
first quarter of 2025.
According to
the second estimate, the U.S. gross domestic product (GDP) decreased at an
annual rate of 0.2 per cent in the first quarter, appearing to be slightly
better than a 0.3 per cent
q-o-q decline reported in the advance estimate. This
marked the first contraction since the first quarter of 2022 (-1.0 per cent q-o-q).
Economists had anticipated
the growth rate to stay unrevised at -0.3
per cent q-o-q.
In the previous
quarter, the economy expanded by 2.4 per cent q-o-q.
The first-quarter drop in real GDP primarily reflected
a rise in imports (which are a subtraction in the calculation of GDP) and a
decrease in government spending that were partly offset by advances in
investment, consumer spending, and exports.