April 29, 2009

Gross domestic product falls sharply

The U.S. gross domestic product fell sharply in the first quarter, the Department of Commerce said Wednesday.

GDP figures -- subject to revision later -- came in with a 6.1 percent drop following a 6.3 percent decline in the fourth quarter last year.

The figure includes negative input from exports, private inventory investment, equipment and software and commercial structures. Gains were reported in consumer spending and imports, which later fell.

Declines in automobile production pulled the GDP down 1.36 percentage points after subtracting 2.01 points in the fourth quarter, the department said.

The price index for gross domestic purchases fell 1 percent, which was a slower decline than the fourth quarter, when consumer prices dropped 3.9 percent. Core prices increased 1.4 percent in the first quarter, following a 1.2 percent increase in the fourth quarter.

The price index indicated that consumer prices have turned around, heading away from an economy-stalling dynamic of deflation.