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First quarter U.S. GDP growth came in at a very weak annualized rate of 0.1 percent, the slowest since the fourth quarter of 2012, and considerably down from the relatively decent rate of 2.6 percent seen in the fourth quarter last year.
Surveys of economists by Bloomberg were anticipating growth around 1.1 percent — slow, because of the unseasonably bad weather, but not this slow.
The slowing growth reflects downturns in exports and nonresidential investment growth, a decrease in business investment in inventories, as well as decreased government spending.
Expectations remain that the Federal Reserve will announce an additional reduction to its quantitative easing program of $10 billion tomorrow — lowering its monthly purchases to $45 billion — but weaker than expected growth figures, still-high unemployment, and below-target inflation may force the Fed to take a wait-and-see attitude to further tapering.