U.S. economic growth accelerated in the first quarter, fuelled by massive government aid to households and businesses, charting the course for what is expected will be the strongest annual performance since 1984.
Gross domestic product increased at a 6.4% annualised rate last quarter, the Commerce Department said on Thursday. That was the second-fastest pace since the third quarter of 2003 and followed a 4.3% rate in the fourth quarter of 2020.
The U.S. economy is rebounding more quickly compared to its global rivals, thanks to two additional rounds of COVID-19 relief money as well as easing anxiety over the pandemic, which has boosted domestic demand and allowed services businesses like restaurants and bars to reopen.
Still, the economy remains at least a couple of years away from fully recovering from the pandemic recession, which started in February 2020.
Former President Donald Trump’s government provided almost $3 trillion in relief money early in the pandemic, leading to record GDP growth in the third quarter.
That was followed by nearly $900 billion in additional stimulus in late December. President Joe Biden’s administration offered another $1.9 trillion rescue package in March, which sent one-time $1,400 cheques to qualified households and extended a $300 unemployment subsidy through early September.