The US economy contracted 5.7 per cent during the first quarter as the recession continues to bite. The latest readings released Friday, by the US Commerce Department updated the figure on GDP to slightly less than 6.1 per cent annualized decline which had been previously estimated last month.

Heavy suffering was experienced in exports, housing and business investment, including inventory investment, which all continued to decline sharply.

The deep recession and the 25-year-high unemployment rate in the US has led consumers to reign in on spending cutting into demand for goods and services. GDP has contracted for three consecutive quarters in the US – which last happened back in 1975.

Although there are numerous economists that believe the recession will be over by year end, there are still many sceptics that see no light at the end of the tunnel in the near future.

The government’s final revision of first-quarter GDP is due June 25

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