A final estimate of first quarter growth confirmed the US economy expanded by a rapid 6.4 percent annualized in the period from January to March of this year, the government said Thursday.

The figure was unchanged from the initial estimate in late April, the Commerce Department said, and represents the last of two revisions made to growth figures the US government releases each quarter.

The measure, which shows how fast the economy would expand if the growth rate continued for a full year, was the fastest first quarter gain since January-March 1984, and came after the Covid-19 pandemic caused a 3.5 percent contraction in 2020 -- the worst since modern recordkeeping began in 1946.

The United States saw rapid economic growth in the first quarter of 2021 as the economy reopened
The United States saw rapid economic growth in the first quarter of 2021 as the economy reopened AFP / Brendan Smialowski

Rubeela Farooqi of High Frequency Economics said there would likely be a strong expansion in the April-June second quarter as well, but the rate could flag later in 2021 as government stimulus measures end.

"There is less certainty further out; even as a better health backdrop and a pick (up) in job growth should be supportive of GDP, fading support from fiscal measures could be a headwind in the second half," she said in an analysis.

Markets and policymakers are paying particularly close attention to inflation amid an ongoing debate over whether prices will spike persistently as the economy bounces back from the pandemic, or if the increases will prove to be temporary.

The data showed a key inflation measure at 3.7 percent in the first quarter, unchanged from the second revision of the data in May and above the Federal Reserve's two percent target. Excluding volatile food and energy prices, inflation was at 2.5 percent.

Coronavirus