WASHINGTON—The U.S. economy grew 1.2% in the first quarter of 2017 – up from the initial estimate of 0.7%.
NAFCU Chief Economist and Director of Research Curt Long credited the rise to "stronger readings of consumer spending and business investment."
The Bureau of Economic Analysis released its second estimate of the first-quarter GDP on Friday.
"The upward revision resulted mainly from stronger readings of consumer spending and business investment. First-quarter growth has been weak in recent years, with later quarters making up the difference," said Long. "This has led many observers to question the government's seasonal adjustments.
"Consumer spending is expected to accelerate during the remainder of the year, but slow wage growth may prevent a more robust rebound," he continued. "The Federal Reserve has downplayed the weak growth figure in the first quarter, suggesting that it was a temporary setback, and appears poised for another quarter-point rate hike in June."
Personal consumption expenditure (PCE) inflation, the Fed’s preferred inflation metric, increased from 2.0% the fourth quarter to 2.4% in the first quarter. This marks the fastest price increase since 2011. Core PCE inflation (excluding food and energy) was 2.1%, up from 1.3% in the fourth quarter.