WASHINGTON (AP) — The U.S. economy shrank at a 0.7 percent annual rate in the first three months of the year, depressed by a severe winter and a widening trade deficit.
The government’s revision for last quarter was weaker than its initial estimate of a 0.2 percent growth rate. The U.S. trade gap – the difference between the value of exports and the larger value of imports – was found to be wider than first estimated. And consumer spending was slower than previously thought.
But steady job gains are expected to fuel modestly healthy growth for the rest of 2015. The harsh winter, which kept many consumers home and businesses closed, and a labor dispute that slowed trade at West Coast ports are both over. Home sales and construction are rebounding, along with business investment.