America’s economy grew by just 0.7% in Q1 2017 compared to 2.1% in Q4 2016, according to credit insurer Coface.
“This was below consensus expectations of 1.0% to 1.2% and was the weakest performance since 2014,” a spokesman said. “The deceleration in real GDP during the first quarter was mainly due to the slowdown in private consumption, which accounts for around 70% of GDP.”
Coface believes these GDP results will make it tougher for the Trump administration to respect its promises of a higher level of expansion in 2017. “The disappointing figures suggest that despite the increase in short-term confidence indicators for households and businesses, this has not, as yet, been able to strengthen economic activity. These preliminary results confirm Coface's forecasts for weaker-than-expected growth for the US economy.”
The positive impact of tax reforms on GDP growth remain unclear and are not expected to be seen in 2017, says the spokesman.
