NEW YORK (Reuters) - The U.S. economy is expanding at its weakest pace in two years, losing momentum following solid growth in the fourth quarter of 2016, according to the Atlanta Federal Reserve’s latest forecast released on Wednesday.
U.S. gross domestic product was on track to grow at a 0.8 percent annualized pace in the first quarter following the latest jobs, consumer price and retail sales data, down from the 1.2 percent rate calculated on March 8, the Atlanta Fed’s GDP Now forecast model showed.
Its latest first-quarter GDP estimate would be the lowest for any quarter since a 0.20 percent GDP contraction the government reported for the first quarter of 2015 USGDPF=ECI.
The Atlanta Fed’s initial estimate for first-quarter growth was 2.3 percent and reached as high as 3.4 percent on Feb. 1 based on strong data on factory activity and construction spending.
Since then, the regional central bank has steadily lowered its GDP growth view.
On Wednesday, the Atlanta Fed said its forecast for consumer spending growth was reduced to 1.5 percent from 1.6 after the release of data on retail sales and consumer prices in February.
Retail sales grew 0.1 percent last month, its smallest rise in six months, while consumer prices edged up 0.1 percent, the weakest reading since July.
Reporting by Richard Leong; Editing by James Dalgleish