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US Economic Growth Slower Than First Thought

A woman shops at a Walmart Supercenter in Rogers, Arkansas, June 6, 2013.
The U.S. says that its economy grew at an annual pace of 1.8 percent in the first three months of the year, sharply lower than first thought.

Earlier, the government had estimated that its economic output advanced by 2.4 percent in the January-to-March period. But on Wednesday, the Commerce Department said that consumers spent less than previously estimated and that both imports and exports fell early in the year. Government spending throughout the country also dropped.

The latest report on the state of the American economy, the world's largest, is a reflection of the nation's uncertain recovery from the depths of the recession more than four years ago. The U.S. jobless rate has declined to 7.6 percent, but remains high by historical standards. At the same time, corporations have amassed cash reserves and key stock indexes remain near record levels.

Analysts are predicting that U.S. economic growth will be about 2 percent or less in the April-June period, but strengthen in the second half of the year.

The gradual advance has led the U.S. central bank, the Federal Reserve, to say that later this year it could begin to cut back on the billions of dollars of securities purchases it has made to stimulate the economy, and could end them altogether by mid-2014.

Some information for this report was provided by AP and AFP.