U.S. economic growth is set to rebound strongly in the second quarter as the scars of a brutally cold winter fade, but inflation pressures will remain tame through 2015, according to the Organization for Economic Cooperation and Development.
In its latest economic outlook published on Tuesday, the OECD forecast U.S. gross domestic product expanding at a 3.9 percent annual pace this quarter, and it said it expects growth to maintain a brisk pace for the remainder of the year as well.
An unusually cold and snowy winter held down GDP growth to a 0.1 percent rate in the January-March period, the government said in an initial estimate last week, and that figure already looks overstated.
Data on construction spending and factory inventories for March that have come in since the GDP report was released have proven weaker than the government had assumed, suggesting the economy likely contracted.
“However, forward-looking indicators, such as investment intentions and business expectations, and rises in measures of consumer and business confidence suggest activity is bouncing back,” the Paris-based OECD said.