US economic growth slows as firms cut investment

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The US economy slowed in the first three months of the year, as businesses reduced investments in the face of higher borrowing costs.

The economy grew 1.1% on an annualised basis, the Commerce Department said.

That was down from a rate of 2.6% in the prior quarter, despite strong consumer spending.

Analysts are watching nervously to see how the world's largest economy handles a mix of higher interest rates and rising prices.

The report on gross domestic product (GDP) is the widest measure of economic activity.

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