The U.S. economy slowed nearly to a halt in the first three months of the year as exports plunged, oil companies slashed business and a rotten winter helped keep consumers indoors.

The economic slowdown, reflected in government data released Wednesday, was sharper than analysts had anticipated and creates a puzzle for employers and policymakers, who are trying to determine whether the annualized 0.2 percent growth between January and March is attributable to temporary factors or is a signal of broader problems.

The news pushed the stock market lower on Wednesday. The Standard & Poor’s 500 index fell 7.91 points, or 0.4 percent, to 2,106.85. The Dow Jones industrial average dropped 74.61 points, or 0.4 percent, or 18,035.53 points. The Nasdaq declined 31.78 points, or 0.6 percent, to 5,023.64.

Sorting out an answer will take at least several more months, but it leaves greater uncertainty about an economy that had until recently been among the world’s best performers. The United States faces challenges not only from a strong dollar, a drag on growth, but also from an oil price decline that has stunted one of the nation’s most bustling industries.

The latest economic data may nudge back the timetable for the Federal Reserve to raise rates, which have stayed close to zero for 61/2 years. On Wednesday afternoon, the central bank said that the winter slowdown was “in part” reflective of “transitory factors” and that “economic activity will expand at a moderate pace” going forward.

Economists now expect that the central bank will hold off until the second half of the year on its rate hike while gauging the direction of the economy, but the Fed did not offer any new hints Wednesday about its timing.

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“This economy is still showing a lot of fragility,” said Diane Swonk, a chief economist at Mesirow Financial, a financial services firm.

The quarterly data provided the most complete picture yet of the economic impact delivered by low oil prices. Lower prices at the pump have helped bolster Americans’ wallets, but since the price slide began in October, the number of American drilling rigs at work has fallen 60 percent and oil companies have shed some 30,000 jobs. In the first quarter, according to the Commerce Department, mining investment declined by $26 billion, or nearly 17 percent. Had investment merely remained flat, the annualized gross domestic product would have been 0.6 percentage points higher.

In the fields from North Dakota to Texas, oil production has not dropped in tandem with investment, because drillers have been focusing resources on their most efficient wells. But exploration for new discoveries is particularly capital-dependent, and private and public oil companies say new projects – with oil below $60 per barrel, compared with more than $100 per barrel last year – would probably lose money.

“Our philosophy is to batten down the hatches, make it through the bad times and get some equilibrium,” said Mike Steele, president and chief executive of Oklahoma City-based Kirkpatrick Oil.

As major economies weaken overseas, the U.S. dollar has gained strength. Though this has some benefits, it also widens the trade deficit.


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