Wall Street Journal (05/29/15) Josh Mitchell; Jeffrey Sparshott

The economy retreated in the first quarter as harsh winter weather across much of the country and a strong dollar tempered demand for American products. Gross domestic product declined at a 0.7% seasonally adjusted annual rate, according to the U.S. Department of Commerce. The agency previously estimated that first-quarter output rose 0.2%. Economists had recently estimated a 1.0% contraction. Although the retreat is expected to be short-lived, it underscores how vulnerable the economy is.

Most economists expect the economy to improve this year, and early indications point to a slight spring rebound. GDP is forecast to grow at about a 2.0% pace in the second quarter, economists say. However, underlying demand is relatively weak. Consumer spending rose at a 1.8% rate in the first quarter, down from 4.4% growth in the fourth quarter.