THE US economy grew at a modest 2.4 percent annual rate from January through March, slightly slower than initially estimated. Consumer spending was stronger than first thought, but businesses restocked more slowly and state and local government spending cuts were deeper.

The US Commerce Department yesterday said economic growth in the first quarter was only just below the 2.5 percent rate originally estimated. That's still much faster than the 0.4 percent growth during the October-December quarter.

Economists believe growth is slowing to around a 2 percent rate in the April-June quarter, as the economy adjusts to federal spending cuts, higher taxes and further global weakness. Still, many say the decline may not be as severe as once thought. That's because solid hiring, surging home prices and record stock gains should keep consumers spending.

Consumer spending accounts for 70 percent of economic activity as measured by the gross domestic product, the economy's total output of goods and services.

The government's second look at GDP in the first quarter showed that consumer spending roared ahead at a 3.4 percent rate. That's the fastest growth in more than two years and even stronger than the 3.2 percent rate estimated last month.

Healthy growth in consumer spending shows many Americans are shrugging off an increase this year in Social Security taxes that has reduced most paychecks.

And more demand from consumers could also prompt businesses to restock at a faster rate later this year. Business inventories grew in the first quarter but at a slightly slower pace than first estimated.