First-quarter growth hits 6.4%; economists see strong year ahead

WASHINGTON — The U.S. economy grew at a solid 6.4% rate in the first three months of the year, setting the stage for what economists believe may be the strongest year for the economy in about seven decades.

Growth in the gross domestic product, the country’s total output of goods and services, was unchanged from two previous estimates, the Commerce Department said Thursday, an acceleration from the 4.3% pace of the fourth quarter.

Economists believe that economic growth has continued to accelerate in the current quarter, which ends this month, as vaccinations become widespread and Americans eager to get outside are being welcomed by newly reopened businesses. Surging activity from consumers is being fueled in part by nearly $3 trillion in financial support that the government has approved since December.

“This summer will be hot for the U.S. economy,” said Lydia Boussour, lead U.S. economist for Oxford Economics. “As the health situation continues to improve, consumers sitting on piles of savings will give in to the urge to splurge on services and experiences they felt deprived of during the pandemic.”

Boussour forecast that growth in the current AprilJune quarter will surge to an annual rate of 12% and growth for the entire year will come in at 7.5%. That would be the best annual performance since 1951.

Even economists whose forecasts for 2021 growth range from 6% to 7% believe growth this year will be the best since a 7.2% gain in 1984, when the U.S. was emerging from an extended and painful recession.