Reply #14: First-Quarter Economic Growth Was Slowest Since Late 2002

[UpInArms]

http://www.nytimes.com/2007/06/29/business/29econ.html?ex=1340769600&en=3afc3127518dd201&ei=5088&partner=rssnyt&emc=rss

WASHINGTON, June 28 (Reuters) — The economy grew at a 0.7 percent annual rate in the first three months of this year, the weakest in more than four years, but a closely watched inflation gauge unexpectedly accelerated, data showed on Thursday.

It was the weakest quarterly expansion in the gross domestic product since the fourth quarter of 2002. The slowdown came as businesses sold off inventories even though consumer spending remained strong.

But a leading inflation gauge favored by the Federal Reserve — the personal consumption expenditures price index excluding food and energy prices — showed that price pressures were stronger than expected.

The index was revised up to a 2.4 percent rate from the prior 2.2 percent estimate. Economists expected the core index to remain at 2.2 percent.

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