US data shows economy in unexpected slowdown

The US economy grew at its slowest pace in nearly two years in the first quarter amid some moderation in consumer spending and a wider trade deficit, but an acceleration in inflation reinforced expectations that the Federal Reserve would not cut interest rates before September.

Wall Street shifted lower on the news before recovering. Treasuries sold off, with yields hitting fresh 2024 highs as the economic figures revived the “stagflation” chatter – bringing more uncertainty to the path of Federal Reserve policy.

Reuters