US economy shrinks by 6.1%

The US economy shrunk by 6.1 per cent in the first quarter of 2009 as cuts by businesses and a drop in exports continue to fuel the US recession.The drop in gross domestic product (GDP), reported by the Commerce Department on Wednesday, was much steeper than the 4.9 per cent annual rate predicted by economists.US exports plunged by 30 per cent, the biggest decline since 1969, as international buyers cut back in the face of economic troubles in their own countries, the report said.And investment in businesses also fell by 37.9 per cent, while investment in housing slumped by 38 per cent, the biggest decline since the second quarter of 1980.The Commerce Department said the government's $787bn stimulus package, approved in February, had had little impact on the first-quarter's GDP.