US GDP growth lower than expected at 2.5 per cent

S GDP has grown at an annualised rate of 2.5 per cent in the first quarter according to estimates. Growth of three per cent was expected after a weak 0.4 per cent showing in the previous quarter. Government spending fell by 8.4 per cent with an 11.5 drop in defence spending.

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Consumer spending rose at its fastest rate since the last quarter of 2010 at 3.2 per cent while inflation continued to undershoot the Fed's two per cent target at 1.2 per cent.