The U.S. economy grew at a weaker-than-expected pace in the first three months of the year and fell to a rate of roughly half that of the fourth quarter.
The advance report on first-quarter gross domestic product showed an expansion of 1.3%, the Commerce Department said Friday. Economists were looking for growth to slow to 1.8% from 2.5% in the fourth quarter.
GDP measures the output of goods and services produced by labor and property located in the U.S. Revised reports on the first quarter will be issued in May and June.
The employment cost index was up 0.8%, a bit below the 0.9% consensus forecast. Personal consumption expenditures increased 3.8% in the first quarter, compared with a rise of 4.2% in the fourth.
Following the report, equity futures dropped, and the dollar fell to an all-time low against the euro. Treasury prices rose, pushing down yields.