Economy slows April to June

WASHINGTON -- The U.S. economy slowed dramatically in the spring to an annual growth rate of 3 percent, as consumers, worried about higher gasoline prices, cut back their spending to the weakest pace in three years, the Commerce Department reported Friday.

The April-June advance in the gross domestic product, the country's output of goods and services, was below the 3.8 percent increase many economists had expected and was significantly down from a revised 4.5 percent growth rate in the first three months of the year.

Treasury Secretary John Snow noted the upward revision of the first-quarter GDP figures with the lower-than-expected second quarter figure. If the two figures were averaged together, he said, it gave evidence of an economy growing at a solid 3.75 percent rate.

The biggest drag on second quarter GDP came from consumer spending, which rose by just 1 percent in the second quarter, the weakest showing since a similar 1 percent rise in the second quarter of 2001.