US growth slowed sharply last quarter to 1.6%, reflecting economy pressured by high rates

WASHINGTON — The nation's economy slowed sharply last quarter to a 1.6% annual pace in the face of high interest rates, but consumers — the main driver of economic growth — kept spending at a solid pace. Thursday's report from the Commerce Department said the gross domestic product — the economy's total output of goods and services — decelerated in the January-March quarter from its brisk 3.4% growth rate in the final three months of 2023. A surge in imports, which are subtracted from GDP, reduced first-quarter growth by nearly 1 percentage point. Growth was also held back by businesses reducing their inventories. Both those categories tend to fluctuate sharp

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