| Consensus | Consensus Range | Actual | Previous | Revised | |
| Quarter over Quarter | 0.2% | 0.1% to 0.2% | 0.2% | 0.2% | |
| Year over Year | 1.1% | 1.1% | 1.3% |
Highlights
Economic growth stalled in the first quarter after having increased 0.2 percent during the final three months of last year, primarily due to a negative contribution from trade, according to preliminary results. Compared to the first quarter of last year, GDP was 1.1 percent higher.
Exports contracted 3.8 percent in the first quarter from the fourth, the sharpest contraction since at least the first quarter of 2024. Imports fell 1.7 percent during the same period after a 0.8 percent contraction the previous quarter, and shows sagging demand. The net result of trade on the overall result was to subtract 0.7 percent, the biggest contraction since the third quarter of 2023 when it declined by the same amount.
Conversely, inventories contributed 0.8 percentage points after a contraction of 0.7 percent in the fourth quarter. This likely came mostly in March when the war in the Middle East broke out as companies rushed to build inventories to get ahead of supply constraints and price increases.
Household spending fell 0.1 percent quarter-on-quarter, the first decline since the first quarter of last year, and will likely persist into the second quarter with the situation in the Middle East. Government spending on the other had rose 0.4 percent in the first quarter, matching the fourth quarter result.
Trade will likely continue to he a drag in the second quarter with the conflict entering its third month as energy supplies continue to be pressured. The ancillary effects are less and more expensive fertilizer, and higher transportation costs. Inventories will likely contribute positively as the buildup continues in the second quarter. Paradoxically, while inventories are increasing, the reason they are is, on balance, negative.
Market Consensus Before Announcement
Growth expected to continue at modest 0.2 percent rate in Q1.