U.S. Economy Got Off to Slow Start in 2017

The Commerce Department provided on Friday its first statistical snapshot of the American economy in the first quarter, the gross domestic product estimate.

■ The economy barely grew, expanding at an annual rate of only 0.7 percent.

■ The growth was a sharp decline from the 2.1 percent annual rate recorded in the final quarter of last year. It was the weakest quarterly showing in three years.

■ Consumption, the component reflecting individual spending, rose by only 0.3 percent, well below the 3.5 percent rate in the previous quarter.

The Takeaway

The first-quarter performance upset expectations for a Trump bump at the start of 2017.

Modest as the headline number looked, it did not come as a surprise to Wall Street — before the report, Wall Street had been looking for growth to come in at 0.9 percent. What is more, many experts said the data was skewed by seasonal factors, like unusually warm temperatures in many parts of the country in January and February.

The economy’s weakness reflected new caution among consumers. Other sectors like housing and business investment turned in a stronger showing, but not enough to offset factors like weaker retail sales.

The Gut Reaction

Don’t panic. The first-quarter numbers were nothing special — but they are not a sign that the economy is headed for a fall, either.

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