US economy shrank at 5% annual rate in Q1, higher than initial estimate

The US economy shrank at an even faster pace than initially estimated in the first three months of this year with economists continuing to expect a far worse outcome in the current April-June quarter.

The Commerce Department reported Thursday that the gross domestic product, the broadest measure of economic health, fell at an annual rate of 5 per cent in the first quarter, a bigger decline than the 4.8 per cent drop first estimated a month ago.

It was the biggest quarterly decline since an 8.4 per cent fall in the fourth quarter of 2008 during the depths of the financial crisis.