The U.S. may have grown in the first three months of 2013 as the fastest rate in more than a year, the government is expected to report Friday, but it always pay to be skeptical. The initial look at gross domestic product often paints an exaggerated portrait of the economy and the devil is in the details.
The first of three government releases on first-quarter growth will be released Friday at 8:30 a.m. Eastern by the Commerce Department. Economists polled by MarketWatch predict annualized growth of 3.2%, up from just 0.4% in the final three months of 2012. The data is seasonally adjusted.
If the economy grew as fast as analysts predict, it would mark the most rapid expansion since the end of 2011 when GDP tallied a 4.1% expansion. Yet much of the seeming strength in early 2013 could simply reflect a snapback in Pentagon-related spending and the level of inventories.
Both of those categories were unusually weak in the fourth quarter and continued large gains should not be expected. Partly as a result, GDP is forecast to slow to less than 2% in the current second quarter.
