Economic growth revised downward for the first quarter

Economic growth revised downward for the first quarter
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The U.S. economy grew by 2.2 percent of gross domestic product (GDP) in the first three months of 2018, the Commerce Department reported Wednesday, 0.1 percent lower than initially projected.

U.S. economic growth lagged slightly between January and March of this year on a drop in consumer and business spending. Analysts had attributed the drop in activity to seasonal factors, such as households tightening spending after the holiday season and severe winter weather.

The Commerce Department initially projected 2.3 percent growth in the first quarter of 2018, but shaved off 0.1 percent in its latest analysis of the timeframe. The department said downward revisions to inventory investment, housing investment and exports drove the growth rate lower, while an uptick in business investment cut the losses.

Growth is expected to rise to about 3 percent of GDP in the second quarter, which would hit the target set by President TrumpDonald John TrumpEx-ethics chief calls on Trump to end 'monstrous' migrant policies Laura Bush blasts Trump migrant policy as 'cruel' and 'immoral' US denies report of coalition airstrike on Syria MORE and projected by White House economists. The U.S. economy grew at a 2.9 percent rate in the fourth quarter of 2017.

Trump and Republican lawmakers have touted their enactment of major tax cuts and repeal of slews of Obama-era regulations as boosting the U.S. economy. The president and his party are banking on solid economic growth and record-low unemployment to sell voters on their agenda ahead of the November midterm elections.

Economists expect the $1.5 trillion tax cuts and increases in government spending to fuel a rise in U.S. growth over the next two years. But those policies are projected to add billions of dollars to the U.S. debt, and analysts have projected a recession to start in 2020.