Economy Grew at a Crawl in First Quarter

What happened to the recession?
By Kevin Spak,  Newser Staff
Posted Apr 30, 2008 8:44 AM CDT
Customers shop at a supermarket in Chicago Tuesday, April 29, 2008.   (AP Photo/Charles Rex Arbogast)
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(Newser) – The US Gross Domestic Product rose at a 0.6% annual pace in the first quarter, despite the widespread belief that the economy is in recession, Bloomberg reports. The number stayed positive thanks to a surge in inventories, which offset flagging consumer spending and business investment. “We think we're in recession, but I don't know that the GDP numbers are going to turn negative at all in 2008,” said one economist.

 “If you were to take out the swing in inventories, these numbers would be negative,” he added. Household spending grew at its slowest rate since the 2001 recession, as jobs were lost and prices rose, particularly on oil and food. Analysts had predicted growth on a 0.5% pace.