US 1st quarter growth at 2.5%

The US economy grew at a pace of 2.5 percent in the first quarter of 2013, with cuts in government spending offsetting private consumption and investment gains, the Commerce Department said Friday.

The first estimate of GDP growth in the first quarter was a solid rebound from the previous quarter's poor 0.4 percent pace, but it came in below the average analyst forecast of 2.8 percent.

Consumer spending gained 3.2 percent, a pick-up from the fourth quarter, and business investment continued to grow, albeit at a slower pace, gaining 2.1 percent.

But federal government spending, hit by the "sequester" budget cuts which took effect during the quarter, continued to drag on the economy, falling 8.4 percent.