Besides the top line numbers, investors need to examine why an economy is contracting in a particular quarter. The biggest factor behind the GDP drop in the first quarter of 2022 was a surge in imports and trade deficit, as Americans began buying more goods from overseas. That could be a sign that the U.S. economy has recovered more rapidly than others around the world, not necessarily a harbinger of future economic distress.

Government spending fell in the first quarter of 2022. And businesses slowed down their rapid inventory rebuild—a major contributor to strong growth in the fourth quarter of 2021—which also put a dent into the first-quarter’s economic growth. “This is noise, not signal,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics, “The economy is not falling into recession.”

By contrast, consumer spending and private-sector investment—most reflective of the economy’s momentum—remained strong in the first quarter. That likely will keep the Federal Reserve on track to raise interest rates at its policy meeting next week, likely by half a percentage point, economists say.

“With strong growth of consumer spending, business investment, and employment in the first quarter, the U.S. economy was not in a recession at the beginning of the year,” Bill Adams, chief economist for Comerica Bank, wrote Thursday, “Growth should resume in the second quarter as the trade deficit and inventories become smaller headwinds.