The US economy grew at an annualised rate of 2 per cent in the first quarter, falling short of Wall Street expectations despite picking up from a weak end to 2025.
Thursday’s figure from the Bureau of Economic Analysis was up from the 0.5 per cent growth rate in the final quarter of last year but below the 2.2 per cent predicted in a Bloomberg poll of economists.
The data comes after the European Central Bank and the Bank of England both held interest rates steady on Thursday as officials await further evidence of the inflationary impact of the Middle East war.
The Federal Reserve also announced it was holding borrowing costs steady the previous day.
BoE governor Andrew Bailey said that keeping rates unchanged at 3.75 per cent was a “reasonable place given the situation of the economy and the unpredictability of events in the Middle East”.
He added: “We’ll continue to monitor the situation and its impact on the UK economy very closely.”
The ECB said: “The longer the war continues and the longer energy prices remain high, the stronger is the likely impact on broader inflation and the economy.”
The decisions from the central banks come amid a packed day of economic data releases that give a picture of how the two-month-old war is impacting Europe and the US.
Data released earlier on Thursday showed that Eurozone inflation rose more than expected to 3 per cent in April as the economy reeled from the energy shock.
Separate figures showed that Eurozone growth slowed to 0.1 per cent in the first quarter.
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