The US economy shrank by less than expected in the first three months of 2009, raising hopes that the US recession could be easing.

The US commerce department said on Friday it had revised its initial reading of the decline in economic activity from January to March to 5.7 per cent - down from 6.1 per cent.

It follows a steep decline of 6.3 per cent for the US's Gross Domestic Product (GDP) in the last financial quarter of 2008.

The department said the improvement came from a bigger decline in imports, an
increase in consumer spending on durable goods such as computers and televisions and a smaller decrease in consumer spending on non-durable goods.

The revised figure was still weaker than the figure of 5.5 per cent most analysts had anticipated, but economists said the numbers were indicative that conditions could be improving.

"The recession is easing," Christopher Low, the chief economist at FTN Financial in New York, told Reuters news agency.

"The second quarter is shaping up to be a smaller decline of about 3.0 to 3.5 percent [and] it should be the last of the negative quarters," he said.

Recession toll

Despite performing slightly better than analysts' expectations, the US economy's poor performance over the last two quarters emphasised the continuing toll of the country's recession, which has led to the loss of 5.7 million jobs since December 2007.

Ben Bernanke, the chairman of the US Federal Reserve, has said the US recession should end this year, barring further bad news for the economy.

The latest figures follow the passing of a $787bn economic stimulus package by US congress earlier this year, as advocated by Barack Obama, the US president, which increased government spending and tax cuts, along with aggressive action by the Federal Reserve to boost lending.

The ailing US economy has been hit hard by the subprime mortgage crisis and subsequent turmoil in global financial markets.