Growth down, Prices up: GDP growth slowed to 1.8%, while inflation jumped to 3.8%

The economy slowed during the first quarter of 2011.

First quarter GDP growth dropped to 1.8% from 3.1% annualized in the fourth quarter.

This was below consensus 2.0%.

The weak Q1 growth was largely due to increasing imports (read oil and gas), a decreasing consumption, a decreasing gov’t spending, and decreasing investment.

Year-on-year, real GDP in the first quarter is up 2.3%, compared to 2.8% in the fourth quarter.

The GDP price index for purchases, increased 3.8% compared to 1.7% in fourth quarter.  This signals increasing inflation. Via BEA:


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