Washington - Stronger consumer spending nudged US economic growth forward at a brisker pace than first thought in the first quarter, the commerce department said yesterday, though worries over the recent war in Iraq put a damper on business investment.

US gross domestic product (GDP), the broadest measure of economic output within US borders, grew at a revised 1.9 percent annual rate in the January-March quarter, in line with Wall Street economists' forecasts and a revision upward from 1.6 percent estimated last month.

The first-quarter expansion exceeded the slim 1.4 percent rate of growth posted in the fourth quarter of last year, but still reflected a slow crawl back to growth rates needed to generate more jobs  
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The department said consumer spending grew at a 2 percent rate in the first quarter instead of the 1.4 percent it reported last month - a key reason for the upward revision in GDP since consumers drive two-thirds of economic growth.

"Underlying the GDP numbers was an increase in final sales growth," said Peter Hooper, the chief economist at Deutsche Bank in New York. "Underlying domestic demand is still expanding despite all the headwind we are facing in the first quarter with war concerns and high energy prices."

Business investment softened in the first quarter, contracting at a 4.8 percent rate after expanding 2.3 percent in the last quarter of 2002. - Reuters