If it seems that fewer flat-screen TVs, appliances and camera phones are barreling through the nation's DCs than there were a few months back, there's a reason for that. After charging ahead at rates that approached 4.0 percent last year, the U.S. economy appears to be easing off the gas pedal. Gross domestic product (GDP) grew at a 3.1-percent rate in the first quarter of 2005, its slowest pace in two years. Analysts say that rapidly rising fuel costs and higher interest rates are causing consumers to think twice before spending.
Those disappointing figures have analysts rushing to revise their earlier forecasts. Some economists have already adjusted their growth expectations to 3.0 percent—perhaps less—for the second quarter, which concludes at the end of this month.
In addition to the slower GDP growth, consumer confidence sagged for the third consecutive month in April. The Conference Board reported that its closely watched index fell 5.3 points to 97.7 for April, slightly below the 98.0 analysts had forecast. The new figure is the lowest since last November.