The Commerce Department says the U.S. economy picked up steam in the first three months of the year, after a rocky finish to 2018.
Gross domestic product grew at an annual rate of 3.2% in the first quarter, up from 2.2% at the end of last year. That’s a significant turnaround from six weeks ago, when many analysts expected a slump in GDP growth to just 2% or less.
A pickup in consumer spending contributed to the improved outlook. Retailers enjoyed strong sales gains in March after a lackluster February.
“I think there’s a sign of relief,” said Jack Kleinhenz, chief economist for the National Retail Federation. “Not only retailers but the overall view of the economy.”
Earlier in the year, shoppers seemed worried about the stock market slump, the government shutdown and trade tensions with China. But by the end of the first quarter, they seemed ready to put those fears aside and resume spending.
“The American consumer is key to the U.S. economy,” said Mark Zandi, chief economist for Moody’s Analytics. “We consume everything we produce and a lot of what everyone else produces across the globe. So if the American consumer is hanging tough, that’s good for our economy but also good for the global economy.”