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U.S. economy expanded by 2.5 percent

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WASHINGTON (AP) - U.S. economic growth accelerated from January through March, buoyed by the strongest consumer spending in more than two years. The strength offset further declines in government spending that are expected to drag on growth throughout the year.

The Commerce Department says the overall economy expanded at an annual rate of 2.5 percent in the first quarter, rebounding from the anemic 0.4 percent growth rate in the October-December quarter.

Much of the gain reflected a jump in consumer spending, which rose at an annual rate of 3.2 percent. That's the best since the end of 2010. Businesses responded to the greater demand by rebuilding to their stockpiles. And home construction rose further.

But government spending fell, led by another deep cut in federal defense spending.

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