WASHINGTON – U.S.
The second-fastest gross domestic product growth since the third quarter of 2003, reported by the Commerce Department on Thursday, left output just 0.9% below its level at the end of 2019.
“In early 2021, the economy was served a strong cocktail of improving health conditions and rapid vaccinations along with a fizzy dose of fiscal stimulus and a steady flow of monetary policy support,” said Lydia Boussour, lead U.S.
Growth was powered by consumer spending, which increased at a 10.7% rate as households bought motor vehicles, furniture, recreational goods and electronics.
That was followed by nearly $900 billion in additional stimulus in late December.
Biden on Wednesday unveiled a sweeping $1.8 trillion package for families and education in his first joint speech to Congress.
There are concerns among some economists that the massive government funding could ignite inflation.
Though the labor market recovery is back on track, it will probably take a few more years to recover the more than 22 million jobs lost during the recession.
Data for the prior week was revised to show 19,000 more applications received than previously reported.
The economy continued to power ahead early in the second quarter, with consumer spending vaulting to a 14-month high in April, thanks to the fiscal stimulus and the expansion of the COVID-19 vaccination program to all American adults.
Growth in the first quarter was also driven by business spending on equipment, which posted a third straight quarter of double-digit expansion.
But trade was a drag for the third consecutive quarter as some of the robust domestic demand was satiated with imports.