Economy ‘cruising’ this year

WASHINGTON — The economy, which moved at the pace of a dawdling tortoise in the closing quarter of last year, seemed more like the speedy hare in the opening quarter of this year.

In fact, the economy logged its fastest growth in 2 1/2 years during the January-to-March period as consumers picked up spending and businesses regained their footing.

Inflation looked tame, too, though the latest figures didn’t include last week’s oil-price spike.

“The U.S. economy is cruising along now,” said Bill Cheney, chief economist at John Hancock Financial Services, after Friday’s latest report by the Commerce Department.

Gross domestic product advanced at a 4.8 percent pace in the January-to-March quarter. That marked a rebound from the feeble 1.7 percent rate in the final quarter of 2005, when fallout from the Gulf Coast hurricanes, including high energy prices, prompted people and companies to tighten their belts.

GDP measures the value of all goods and services produced within the United States and is considered the best barometer of the economy’s fitness.

“This rapid growth is another sign that our economy is on the fast track,” said President Bush.

Recent growth hasn’t helped Bush’s standing with the public. He is shouldering his lowest-ever job approval rating, at 36 percent, according to an AP-Ipsos poll.

Democrats contend that the economic expansion isn’t benefiting all. “This growth is showing up in the bottom lines of companies, but not in the paychecks of workers,” said Sen. Jack Reed, D-R.I.

On Wall Street, the Dow Jones industrials lost 15.37 points because of a tepid outlook from software company Microsoft Corp.

The first quarter’s performance — the best showing since the third quarter of 2003 — was close to economists’ forecasts of a 4.9 percent growth rate.