US economy: 3.5 percent increase in the first quarter of this year

US economy increased at an annual rate of 3.5 percent in the first quarter of this year, higher than the rate of 3.1 percent announced last month, the &to=http:// ' target=_blank>Commerce Department reported on Thursday. The gain followed a rate of 3.8 percent in the last quarter of 2004 and a gain of 4.4 percent for the full year.

The report showed that consumer spending, which accounts for about two thirds of the total gross domestic product and is the major force in pushing the economy forward, grew 3.6 percent in the first quarter. That was up a bit from the initial estimate of 3.5 percent reported last month but down from the fourth quarter's4.2 percent.

Business investment in equipment and software increased 5.6 percent in the first quarter. That was down from a previous estimate of 6.9 percent and marked a big deceleration from the hot18.4 percent of spending seen in the fourth quarter, reports Xinhuanet.

Higher consumer spending and residential construction, along with a better net &to=http:// ' target=_blank>trade performance, accounted for much of the revision from the Commerce's Department's first read of the GDP numbers, tells the Industry Week.

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