Exceeding Expectations, US Economy Showed Surprising Q1 Growth

Exceeding Expectations, , US Economy , Showed Surprising Q1 Growth . On May 25, the Commerce Department said that the United States economy saw faster growth in the first three months of 2023 than previously forecast. CNN reports that gross domestic product (GDP) increased at an annualized rate of 1.3% in the first quarter. . According to CNN, increased consumer spending assisted in fueling first quarter growth, accounting for about two-thirds of U.S. economic output. Meanwhile, over the same period, businesses cut back spending on new equipment. In April, retail sales saw a rebound followed by two months of decline, while employers added 253,000 new jobs and average hourly wages grew by 0.5%. In May, private-sector business activity grew at a rapid pace, as service-providing businesses reported growing demand, a hiring boom and increased optimism. . At the same time, manufacturing in the U.S. dropped back into contraction territory amid substantially reduced demand. The US economic expansion gathered further momentum in May, but an increasing dichotomy is evident. , Chris Williamson, Chief business economist at S&P Global Market Intelligence, via CNN. While service sector companies are enjoying a surge in post-pandemic demand, especially for travel and leisure, manufacturers are struggling with overfilled warehouses and a dearth of new orders as spending is diverted from goods to services, Chris Williamson, Chief business economist at S&P Global Market Intelligence, via CNN. While service sector companies are enjoying a surge in post-pandemic demand, especially for travel and leisure, manufacturers are struggling with overfilled warehouses and a dearth of new orders as spending is diverted from goods to services, Chris Williamson, Chief business economist at S&P Global Market Intelligence, via CNN. CNN reports that strong consumer spending is expected to continue into the summer, suggesting gains for leisure and hospitality could prop up employment levels.