The US economy expanded at annual rate of 1.3 percent in first quarter 2001, the Commerce Department reported today in a downward revision of an initial estimate of two percent growth.
Wall Street analysts had foreseen growth of 1.4 percent in the quarter after one percent in the final three months of 2000.
The downward revision reflects the largest inventory drawdown in nearly two decades, weaker consumer spending and higher imports.
Inventories fell a revised 18.9 billion dollars in the first quarter, nearly three times the initial estimate of a 7.1 billion dollar reduction. With companies selling off built-up stocks rather than producing, overall growth slowed.
The last time inventories posted such a sharp reduction was in the first quarter of 1983, when their value was down by 42 billion dollars.
The gross domestic product chain-weighted price index, a measure of inflation, 3.2 percent in the first quarter, unrevised from the prior estimate.
Excluding food and energy prices, the index rose a revised 2.2 percent, down from the previous estimate of 2.3 percent.
Another inflation gauge, the consumption price index, increased a revised 3.2 percent in the first quarter, down slightly from the previous estimate of a 3.3 percent.
Excluding food and energy prices, the consumption index was up 2.6 percent.
Consumer spending rose at a revised 2.9 percent rate in the second quarter rather than the initially estimated 3.1 percent gain.
The bulk of the downward revisions came from spending on non-durable goods, which rose a revised 1.5 percent in the first quarter, compared with the initial estimate of a 2.6 percent gain.
Business investment increased at a revised 2.1 percent annual rate in the first quarter, up from the initial assessment of a 1.1 percent increase.
The trade sector added 1.1 percentage points to first quarter GDP growth, down from the initial estimate of 1.38 points .
Imports fell at a revised 9.1 percent rate in the first quarter, down from the initial estimate of a 10.4 percent decline .
Exports fell at a revised 2.7 percent rate in the first quarter, sharper than the initial estimate of 2.2 percent.
Government spending rose a revised 4.7 percent rate in the first quarter rather than the initial estimate of a four percent gain.
This is the first revision to first quarter GDP data. A second and final revision will be released on June 29.
AFP