U.S. Slowed Down Growth as Weakened Consumer Spending

The U.S. economy slowed down compared in the first quarter as the consumer spending has performed weakly in almost five years. Yet, it seems that momentum of growth has kicked up amid a strong labor and tax cuts.

The gross domestic product rose by 2.0 percent at an annual rate in the first three months of the year, as the third estimate for the first quarter, according to the report by the Commerce Department on Thursday. This is in comparison of the 2.2 percent in the previous month.

In the last quarter of 2017, the economy grew by 2.9 percent rate. The decline in the first quarter shows weaker consumer spending and a smaller inventory supply than the estimate in the previous month.

The tax cut package amounts to $1.5 trillion income implement in January, reflecting economic growth at a faster rate in the second quarter in line with the 3 percent target of Trump administration.

Economists indicate the "America First" policies that escalated fears on trade wars that dims the economic outlook.

The growth estimate is as high as 5.3 percent while the economists anticipate growth at unrevised 2.2 percent. Another measure of growth is Gross Domestic Income (GDI) which climbed at a faster rate by 3.6 percent rate in three months to March. The statistics were revised higher from the 2.8 percent rate last month.

The average of GDP and GDI called as gross domestic output shows a better measure of economic activity that rose grew by 2.8 percent in the first quarter compared to the 2.5 percent estimate in May.