The U.S. economy slowed in the first few months of 2014 mainly due to the unusually cold weather across the country, falling to only 0.1 percent GDP growth and missing the consensus estimate from economists at 1.2 percent growth.
By comparison, in the fourth quarter of 2013, real U.S. GDP increased 2.6 percent.
The second U.S. GDP estimate for the first quarter of 2014 which utilizes more complete data will be released by the Commerce Department on May 29, 2014.
Real gross domestic purchases, which records the purchases by U.S. residents of goods and services, increased 0.9 percent in the first quarter of 2014, compared with an increase of 1.6 percent in the fourth quarter of 2013.
Real exports of goods and services decreased 7.6 percent in the first quarter of 2014 compared with an increase of 9.5 percent in the fourth quarter of 2013.
Expectations are high during the remaining quarters of 2014 for improving U.S. GDP growth, as construction and the housing market gradually improve.
Although the GDP outlook for 2014 remains positive, infrastructure spending by the U.S. government remains weak even despite President Obama’s efforts to lay out his vision for a 21st century transportation infrastructure in February at the Union Depot train station in Saint Paul, Minnesota.
Obama’s infrastructure vision calls for a 4 year, $302 billion plan to repair the nation’s bridges and roads that relies on obtaining funding from tax reform, a policy move that most Republicans oppose ahead of the mid-term elections in November.
“We’re going to close wasteful tax loopholes, lower tax rates for businesses that create jobs here at home, stop rewarding companies for sending jobs to other countries, use the money we save in this transition to create good jobs with good wages rebuilding America. It makes sense” Obama said from Saint Paul, Minnesota in February.
Presently, the U.S. highway trust fund is financially strapped and could become insolvent as early as August.
Congress has until September 30th to extend federal funding for transportation programs.
According to Financial Times article on November 3rd, U.S. infrastructure spending has operated at the 5 percent level of U.S. output on average since the end of World War II.
But in 2013, U.S. infrastructure spending dropped to 3.6 percent mainly due to federal austerity from the sequester cuts along with falling revenues from fuel taxes as more vehicles on the road become fuel efficient.