The U.S. economy grew at a 2.5 percent annual rate in the first quarter of 2013, the Bureau of Economic Analysis estimated Friday morning.
That's modest growth, and was below the 3.2 percent pace economists had expected to hear about. But growth was up substantially from fourth-quarter 2012, when the economy expanded at a scant 0.4 percent annual rate.
The agency will issue revised estimates of first-quarter growth in each of the next two months, so the figure could change. The agency initially reported, for example, that gross domestic product shrank at a 0.1 percent annual rate in fourth-quarter 2012. Then it said there was 0.1 percent growth. On its third swing at the figures, it came up with the 0.4 percent estimate. The figures shift as more information comes in.
We'll have more from the report and reactions to it as the morning continues.
Update at 8:55 a.m. ET. Not Much Real Change?
"The acceleration in growth in the early stages of the year stood in sharp contrast to the paltry 0.4% increase in gross domestic product in the fourth quarter of 2012. Yet the underlying strength of demand for U.S.-made goods and services was actually weaker in the first quarter. So-called real final sales rose just 1.5% — matching the smallest increase in two years.
"The softness in demand suggests little change in the overall pace of U.S. growth once unusual factors are stripped out. The economy has been expanding at about a 2% clip for the past two years."
Update at 8:45 a.m. ET. News Could "Weigh On Stocks":
"Given the smaller-than-expected increase and signs the economy has weakened in recent weeks, the GDP data will probably weigh on U.S. stocks," Reuters writes. "It could also give ammunition for the Federal Reserve to maintain its monetary stimulus."
Update at 8:40 a.m. ET. Consumer Spending Was Critical:
Growth was "buoyed by the strongest consumer spending in more than two years," The Associated Press writes. "The strength offset further declines in government spending that are expected to drag on growth throughout the year."