U.S. Economic Growth Down In 1st Quarter Of 2023

Despite surging interest rates, punishing inflation and global turbulence, the US economy stood firm last year.

Photo Insert: The US economy is widely expected to decelerate steadily and slip into a recession sometime this year.

From employers to consumers, the picture was one of surprising resilience.

This year may be shaping up as a more downbeat story. The economy is widely expected to decelerate steadily and slip into a recession sometime this year, Paul Wiseman reported for the Associated Press (AP).

Some early such signs could begin to emerge when the Commerce Department will issue its first estimate of the economy’s performance in the first three months of 2023.

Forecasters have predicted that the gross domestic product — the broadest measure of economic output — grew at a 1.9% annual rate from January through March, according to a survey by the data firm FactSet.

That would mark a significant slowdown from the 3.2% growth rate from July through September and the 2.6% rate from October through December.

The obstacles the economy faces are growing more troublesome. The biggest among them is the dramatically higher cost of borrowing. The Federal Reserve, in its fight against an inflation rate that last year hit a four-decade high, has raised its benchmark rate nine times in just over a year.

As those higher rates spread through the economy, it is becoming steadily more expensive for consumers and businesses to borrow and spend. The cost of a loan to buy a house or a car or to expand a business can become prohibitively expensive.

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