U.S. Economic Growth Accelerates Slightly Less Than Expected In Q1
(RTTNews) - A report released by the Commerce Department on Thursday showed U.S. economic growth reaccelerated in the first quarter of 2026 but came in slightly below economist estimates.
The Commerce Department said gross domestic product shot up by 2.0 percent in the first quarter after climbing by 0.5 percent in the fourth quarter of 2025. Economists had expected GDP to jump by 2.1 percent.
The increase in GDP in the first quarter reflected positive contributions from investment, exports, consumer spending and government spending.
Meanwhile, the report said imports, which are a subtraction in the calculation of GDP, skyrocketed by 21.4 percent during the quarter.
The Commerce Department also said the acceleration in the pace GDP growth compared to the previous quarter reflected upturns in government spending and exports, and an acceleration in investment that were partly offset by a deceleration in consumer spending.
"The core of the economy remained solid in Q1, driven by the AI buildout and the tax cuts beginning to feed through," said Michael Pearce, Chief U.S. Economist at Oxford Economics.
He added, "Those factors will continue to drive growth over the rest of the year, but the jump in energy prices will take some of the shine off what would otherwise have been a strong year for the economy."
On the inflation front, the report said the personal consumption expenditures (PCE) price index soared by 4.5 percent in the first quarter after surging by 2.9 percent in the fourth quarter.
The core PCE price index, which excludes food and energy prices, also spiked by 4.3 percent in the first quarter after jumping by 2.7 percent in the fourth quarter.
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