US economic growth roaring ahead

Exports are helping lead the US economy

The US economy roared ahead by 5.3% in the first quarter of 2006, its fastest growth rate in two-and-a-half years, revised official data has shown.

The new figure for the first quarter is more than triple the 1.7% growth rate recorded in the last quarter of 2005.

The upward revision, from the initial 4.8%, came as growth was led by exports and firms increasing inventories, said the Commerce Department.

It is however still below the 5.7% level forecast by Wall Street.

'Market fears unwarranted'

The new report "helps undermine the recent exaggerated fears in the market that economic growth is slowing sharply", said analyst Dick Green at Briefing.com.

"Market fears of a sharp slowdown in economic growth, or even of a recession, are unwarranted."

Yet other analysts were less sanguine about the figures, saying they were now too retrospective, and the real focus should instead be on waiting to see what the second quarter figures will look like.

"This is mostly a non-event," said Brian Dolan, director of FX Research at Gain Capital.