US Q1 economic growth figures revised downwards

The Commerce Department has today revealed the US economy grew by an annualised 2.7% in the January to March period – slightly lower than the 3.2% previously estimated.

This figure is the third and final estimate and the downward revision was due to a slower rate of business investment and consumer spending.

However, it still means the world’s largest economy has grown for three consecutive quarters as it continues its recovery from the worst recession in decades.

Meanwhile, unemployment in the world’s largest economy remains high. Recent figures show the unemployment rate fell to 9.7% in May, from 9.9% in April.

The economy added 431,000 jobs last month – the majority of them temporary Government jobs to help conduct the 2010 census.

However, the figure fell far short of the 515,000 expected by analysts and followed an unrevised 290,000 increase in April.

There has also been some disappointing news in the housing market this week with the Commerce Department revealing a record fall in sales of new homes in the US for the month of May.

Furthermore, the National Association of Realtors (NAR) revealed a surprise drop in sales of previously owned homes in the US for the month of May.

Both sets of figures raised concerns about the health of the US housing market.

However, on a positive note, a separate report today showed US consumer sentiment rose in June to a level not seen since January 2008.

The Thomson Reuters/University of Michigan’s index on consumer sentiment rose to 76 in June from 73.6 the previous month.

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