US GDP growth accelerates in Q1

(Sharecast News) - US economic growth accelerated in the first quarter, with preliminary figures showing GDP rising 2% as higher government spending and stronger domestic investment helped offset a slowdown in consumer demand. The Bureau of Economic Analysis' Q1 reading follows a 0.5% rise in the final quarter of 2025, when activity was held back by a sharp contraction in federal spending after large‑scale government layoffs.

Government expenditure rebounded at the start of 2026, swinging from a 5.4% decline in Q4 to a 4.4% increase, while domestic investment rose 6.4%, supported by continued spending on artificial‑intelligence infrastructure.

Consumer spending, however, lost momentum, easing 0.3 percentage points from late 2025 as the conflict with Iran pushed energy prices higher and weighed on sentiment.

The advance estimate captures only the first month of the war, though its impact on energy markets has been immediate. Oil prices have surged in recent weeks, with Brent hitting $126 a barrel on Thursday as tensions around the Strait of Hormuz escalated.

Thursday's reading was the first of three GDP estimates, with revisions due in the coming weeks.





Reporting by Iain Gilbert at Sharecast.com