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Economy

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Other economic reports released Thursday include:
Jobless claims: The number of Americans seeking unemployment benefits rose 10,000 last week to a seasonally adjusted 354,000. Still, the level of applications is consistent with steady hiring and remains near a five-year low. The Labor Department said applications increased from a revised 344,000 the previous week, slightly higher than the 340,000 initially reported.
Foreclosures: Sales of bank-owned homes have plunged to a five-year low. For the January-March quarter, sales of bank-owned homes fell 16 percent from the previous three months and were down 23 percent versus the first quarter of 2012, foreclosure tracker RealtyTrac Inc. said.

1st-quarter growth pegged at 2.4%

GDP revised slightly lower; analysts look for 2% rate in future

– The U.S. economy grew at a modest 2.4 percent annual rate from January through March, slightly slower than initially estimated. Consumer spending was stronger than first thought, but businesses restocked more slowly, and state and local government spending cuts were deeper.

The Commerce Department said Thursday that economic growth in the first quarter was only marginally below the 2.5 percent annual rate the government had estimated last month. That’s still much faster than the 0.4 percent growth during the October-December quarter.

Most economists think growth is slowing to around a 2 percent annual rate in the April-June quarter as the economy adjusts to federal spending cuts, higher taxes and further global weakness. Still, many say the decline may not be as severe as once thought. That’s because solid hiring, surging home prices and record stock gains should keep consumers spending.

Jennifer Lee, senior economist at BMO Capital Markets, said the small revision to first-quarter growth supports her view that the economy will grow a moderate 2.2 percent for the year, the same as last year.

Still, Lee expects growth to improve to 3.2 percent in 2014, as the job market accelerates and consumers grow more confident.

Consumer spending accounts for 70 percent of economic activity as measured by the gross domestic product. GDP is the economy’s total output of goods and services, as varied as haircuts, computers, trucks and aircraft carriers.

The government’s second look at first-quarter growth showed that consumer spending roared ahead at a 3.4 percent annual rate. That’s the fastest spending growth in more than two years.

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