Economists slashed forecasts for second quarter growth by as much as a half percent, after new data showed weaker exports and slower-than-expected investment in inventories.
Second quarter tracking GDP fell to 3 percent, a decline of 0.4 percent, according to the CNBC/Moody’s Analytics Rapid Update. The update had shown second quarter growth as high as 3.6 percent.
There had been hope for a big bounce back in the second quarter to make up for extremely sluggish first quarter growth of 0.7 percent, which had been blamed on temporary factors like weather. Three percent is still a healthy growth rate, but there has been a series of disappointing economic reports lately.
Economists have revised first tracking quarter GDP to 0.8 percent, down from a higher expectation of 0.9 percent before Thursday’s data, according to the Rapid Update survey. The second look at first quarter GDP will be released by the government Friday morning.