The U.S. economy sputtered in the first quarter of Donald Trump's presidency, growing at the slowest pace in three years while serving as a reminder of the fragility of the nation's economy.
The Gross Domestic Product (GDP) in the United Kingdom expanded 2.10 percent in the first quarter of 2017 over the same quarter of the previous year. The administration touted the plan as a central pillar of Trump's promise to boost economic growth to 3%, while observers noted it would balloon the deficit by trillions of dollars and is is highly unlikely to make it into law in its current form.
However, higher confidence about the economy's future hasn't translated into higher spending right now.
But, "Just because people feel happy doesn't mean they will act on those feelings, and they clearly didn't during the first quarter", economist Joel Naroff said in a commentary on the report.
"There's reason to think that some of the things that were weak in the first quarter should reverse in the second quarter, in particular consumption and inventories", Michael Feroli of JPMorgan Chase & Co. said.
Britain's powerhouse services sector, which accounts for 78% of the United Kingdom economy, put downward pressure on overall growth after expanding by 0.3% between January and March this year, slowing from 0.8% between October and December of 2016. This is a slowdown from a 2.1 percent rate in the fourth quarter and was below median consensus estimate of 1 percent. The resulting rise in economic growth is expected to compensate for the loss in tax revenue - although the rationale is not widely accepted by experts.
However, many economists are more skeptical.
Net exports contributed 0.07 percentage point to the growth in the quarter, compared to a subtraction of 1.82 percentage points in the previous quarter.
Erdogan rejoins Turkey ruling party after near 3-year absence
Then we will sit at the able and talk. "Otherwise, we have nothing left to discuss with you", Erdoğan said. Critics fear that the new presidential system approved in the referendum will lead to a one-man rule.
Since coming to office, the Trump administration is aiming to get to 3% growth with tax reform and better trade deals, among other actions aimed at boosting the USA economy.
Analysts also cautioned that the most recent numbers may have suffered some distortion, with a rebound likely in the next quarter.
Government delays issuing income tax refunds to combat fraud also weighed on consumer spending.
Meanwhile, business investment got a jolt from a record increase in spending on oil and gas exploration. But that was a significant slowdown from the brisk 9.4 percent in the prior quarter. Manufacturing accounts for a grossly disproportionate share of equipment investment. For the first quarter, trade was actually a small positive after a major drag in the fourth quarter.
But a Labor Department report also released Friday pointed in a different direction from GDP.
The Eurozone's core inflation rate, which does not include the cost of food, energy, alcohol or tobacco, rose to 1.2 percent from 0.7 percent.
"Fed hawks will seize on this report", Shepherdson said. This means that while the United States economy might be tumbling into a period of stagflation, the central bank still has the opportunity to continue raising base interest rates, making fiscal stimulus an urgent necessity.