The advance estimate of GDP for the first quarter was an annual rate of 1.4%. That there would be a drop from the 3.4% rate in the fourth quarter of 2023 was widely expected. The details of what moved and how are important.

But first, recognize that this was a slowing of real gross domestic product growth, not a fall in GDP, and so probably not a sign of a recession. The rough rule-of-thumb of two consecutive quarters of negative growth wouldn't even start under this result. Although the actual call of a recession by the National Bureau of Economic Research uses a far more complex set of metrics, it has never seen a recession when there was no fall in GDP. Also, advance estimates often change as additional information is available.

The increase in real GDP owed to various parts of the economy — consumer spending, residential fixed investment, non-residential fixed investment, and government spending — according to the Bureau of Economic Analysis. Slowing economic growth were a decrease in private inventory investment and an increase in imports, which are considered a reduction of GDP. (A strong dollar tends to correlate with increased imports, as well as contributing to a reduction of manufacturing reshoring but an increase of warehousing.)