U.S. economy grew 6.4% in 1st quarter; 2nd-largest gain of COVID-19 era

April 29 (UPI) -- Economic activity in the United States increased by more than 6% over the first three months of 2021, the Commerce Department said in its quarterly report Thursday -- the second-largest increase of the COVID-19 era.

The department said in the report U.S. gross domestic product, the overall measure of goods and services, increased by 6.4% between January and April.

Most analysts had expected growth of about 6.5%. GDP growth was 4.3% in the fourth quarter of 2020.

"The increase in the first-quarter GDP reflected the continued economic recovery, reopening of establishments, and continued government response related to the COVID-19 pandemic," the report states.

"Government assistance payments, such as direct economic impact payments, expanded unemployment benefits, and Paycheck Protection Program loans were distributed to households and businesses."

The only other quarter that performed better since the start of the coronavirus pandemic was Q3 in 2020, when it expanded by a record 33%, fueled my mass reopenings in the United States during the July-October period.

The Commerce Department said gains were seen in several sectors, including personal consumption, residential investment and government spending.

The report said U.S. consumers, who account for about 70% of the economy, accelerated spending by 11% in the first quarter. That figure was 2.3% the previous quarter.

"This signals the economy is off and running and it will be a boom-like year," Mark Zandi, chief economist at Moody's Analytics, told CNBC. "Obviously, the American consumer is powering the train and businesses are investing strongly."