US recession fears grow as economy slows sharply in first quarter

The world's largest economy slowed sharply in the first quarter of the year, according to the first official estimate which has raised fears of recession ahead.

The growth was mainly explained by consumer spending holding up, probably due to a low unemployment rate, as the aggressive pace of interest rate rises to tame inflation hit other areas, such as the housing market, harder. Many economists say the cumulative impact of the Fed Reserve's rate hikes has yet to be fully felt while the pace of hiring is slowing.

There are signs the crisis of confidence is not over yet as First Republic, a major regional lender, has seen a fresh run on its share price this week taking it to fresh lows.

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