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Economy zooms forward

First quarter GDP beats forecasts, but housing market slows

WASHINGTON -- The economy sprinted during the opening quarter of 2006 but may slow to a more leisurely jog through the rest of the year.

Economic activity zipped ahead at a 5.3 percent pace in the January-March period, even speedier than initially thought. But a less energetic housing market and high energy prices are now taking out some of the oomph.

``I think we sort of had the last hurrah for the economy for a while," said Nariman Behravesh, chief economist at Global Insight. ``We aren't going to see this kind of growth for a bit. We will see softening in the economy, but there's no reason to be pessimistic."

The figure released by the Commerce Department yesterday showed gross domestic product during the quarter surpassing the 4.8 percent annual rate estimated a month ago. It marked the strongest growth spurt in 2 1/2 years. The upgrade mostly reflected stronger US exports and better inventory building by businesses.

GDP, which measures the value of all goods and services produced in the United States, totaled $11.39 trillion in the first quarter when annualized and adjusted for inflation.

On Wall Street, stocks rallied. The Dow Jones industrial average gained 93.73 points to close at 11,211.05.

The housing market is losing some of its shine as mortgage rates rise. Sales of previously owned homes fell 2 percent in April to 6.76 million units, the National Association of Realtors said .

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