Gross domestic product increased at a 1.2 percent annual rate instead of the 0.7 percent pace reported last month,<br />the Commerce Department said on Friday in its second GDP estimate for the first three months of the year.<br />WASHINGTON — The U. S. economy slowed less than initially thought in the first quarter,<br />but there are signs it could struggle to rebound sharply in the second quarter amid slowing business investment and moderate consumer spending.<br />While GDP growth appears to have regained speed early in the second quarter, hopes of a sharp rebound have been tempered by weak business<br />spending, a modest increase in retail sales last month, a widening of the goods trade deficit and decreases in inventory investment.<br />EQUIPMENT SPENDING SLOWING<br />In a second report on Friday, the Commerce Department said non-defense capital goods orders excluding aircraft,<br />a closely watched proxy for business spending plans, were unchanged in April for a second straight month.<br />Growth in consumer spending, which accounts for more than two-thirds of U. S. economic activity,<br />rose at a 0.6 percent rate instead of the previously reported 0.3 percent pace.<br />Spending on equipment rose at a 7.2 percent rate in the first quarter rather than the 9.1 percent reported last month.
