GDP Disappoints: U.S. Economy Grew Just 1.1% in First Quarter

The U.S. economy expanded at a sluggish 1.1 percent annual pace in the first three months of the year despite strong consumer spending.

Wall Street analysts had expected a two percent increase in gross domestic product after the economy grew 2.6 percent in the final three months of last year.

Consumer spending remained very strong, rising 3.7 percent in the January through March period.

The weakness came from business investment and inventories, perhaps suggesting that businesses expected a weaker level of consumer spending.