
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, June 21, 1990                   TAG: 9006210521
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A/6   EDITION: EVENING 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

1ST-QUARTER ECONOMIC GROWTH SLOW

The nation's economy grew at a 1.9 percent annual rate from January through March, the second-slowest quarterly advance in more than three years, the government said today.

The Commerce Department said the increase in the broadest measure of the nation's economic health - the gross national product - was up from the 1.1 percent rate in the final quarter of 1989. That had been the slowest advance since a 0.8 percent gain in the summer of 1986.

At the same time, inflation as a price index tied to the GNP rose 6.4 percent at an annual rate. It was an improvement from the 6.7 percent increase reported last month and the 6.5 percent advance originally reported in April.

The inflation rate was the highest since it raced ahead at an annual rate of 7.7 percent in the final quarter of 1981. However, most economists attributed the jump in the January-March period to the adverse effects of unusual winter weather and predicted prices would decline during the remainder of the year.

The new GNP figure for the first quarter approached the 2.1 percent gain in the department's original estimate in April. That estimate was lowered last month to 1.3 percent.

Most economists had expected little change from the May figure.

The economy advanced 3.0 percent in 1989, down from 4.4 percent a year earlier.

Despite the slower growth, most economists believe the economy will continue to skirt a recession, generally defined as two straight declines in the GNP.

In fact, the Federal Reserve released a survey on Wednesday indicating the economy continued to grow sluggishly through the first part of June, although recessionary pockets were found in some sectors.

The first-quarter growth rate was less than the Bush administration's 2.4 percent estimate earlier this year. To meet that goal, the economy would have to spurt ahead 2.6 percent at an annual rate during the remaining nine months.

by CNB