We may be in for a spring slowdown — for the third consecutive year. U.S. economic output grew at the anemic rate of 2.2 per cent in the first quarter of the year, report found.

At first glance disappointing, the number actually confirms the upward trend that saw the economy through a slow but steady growth period in 2011. Those optimistic hope that this is a sign that the economy will sustain at least the minimum rate of recovery, while others are fearful of a full blown slowdown as per last year. The worry was confirmed when durable goods order numbers, a leading economic indicator, dipped to January 2009 figures, the lowest since the recovery began.

According to the New York Times, the 2.2 per cent is not substantial enough to alter the Federal Reserve’s outlook; Chairman Ben Bernanke has stated that he will continue to keep the interest rates low into 2014.

More troubling, the news of a potential spring slowdown came just hours after credit rating agency Standard & Poor’s downgraded Spain’s long term sovereign credit rating to BBB+ from A, a second this year.

S&P concluded that Spain’s high sovereign debt levels would require financial support as the country’s economy continues to contract.

They are not the first to take the axe on Spain, however. Last February, Moody’s, the other major rating agency, also cut Spain’s rating. With nearly one in four Spanish being unemployed, more downgrade is expected to come.

Spain is certainly beleaguered, but in no ways comparable to Greece, which was downgraded to junk status by all three major rating agencies, including Fitch, last year.

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May Jeong is Toronto Standard’s business editor. Follow her on Twitter @mayjeong.

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