THE US economy grew at an annualised pace of 2.2% in the opening three months of this year – a performance in stark contrast to the renewed recession in the UK but slightly weaker than forecast by Wall Street.
This growth in US gross domestic product – equivalent to quarter-on-quarter expansion of about 0.55% – was revealed yesterday by Commerce Department data. It emerged this week that the UK had tumbled back into recession amid the Conservative-Liberal Democrat Government's austerity drive.
Data on Wednesday from the Office for National Statistics showed UK GDP fell 0.2% quarter-on-quarter in the first three months of this year. This was the second straight quarter of contraction – with UK GDP having slid by 0.3% in the final three months of 2011 – and thus constituted renewed recession.
Chris Williamson, chief economist at financial information company Markit, said: "The US economy remains a bright light in the global economy, although the light is hardly blinding, and also showing some signs of fading.
"The ongoing expansion of the US economy in the first quarter, though far from buoyant, sits in stark contrast to recessions in the United Kingdom and the eurozone. As such, the US remains one of the few drivers of global demand and economic growth in 2012."
Mr Williamson took some encouragement from the breakdown of the US GDP figures, in spite of the slowdown in the pace of growth in the world's largest economy from an annualised rate of 3% in the final three months of 2011.
Mr Williamson said: "Once stock-building has been accounted for, the underlying rate of growth picked up, from an annualised rate of 1.1% late last year to 1.6%. It was also encouraging to see consumer spending grow at an increased rate of 2.9%, compared to 2.1% in the final quarter of last year."
However, he added: "The big disappointment was a 2.1% annualised drop in business investment."
Paul Ashworth, chief US economist at consultancy Capital Economics, said: "At least private sector spending posted a decent gain, although we'll find out over the next few months just how much of that gain was due to the mild winter."
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