Growth revised up as US heads towards rate hike
The US economy grew a little faster than first thought in the first three months of the year, though expansion was still sluggish at just 0.8 per cent on an annual rate.
First estimates earlier this month suggested the economy grew by an even more miserly 0.5 per cent, but the upward revision should provide a little more faith that the world's largest economy will bounce back in the second quarter.
The slightly stronger data will also be interpreted in the context of the Federal Reserve's recent statement that it will "likely" raise interest rates if economic data holds steady before they meet in mid-June.
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Economists said survey data, including the Atlanta Federal Reserve's "GDPNow" model, points to a 2.9 per cent annualised expansion in the US economy during the second quarter.
The basis for the upwards revision was that "private inventory investment" over the period came in higher than was originally thought.
With Fed chair Janet Yellen speaking this afternoon, market eyes are expected to turn towards the prospect of a rate rise. Futures markets are pointing towards a one in three chance of a rate rise in June, with a 60 per cent liklihood of a hike in July.
At 0.8 per cent on an annual rate, the US expansion is still below the rate of growth in the UK, Eurozone and Japan.