The final revision of first-quarter gross domestic product confirmed a larger contraction of the U.S. economy than earlier readings, supporting the view that a recession is either in progress or coming, say economists, as inflation rages and stocks head for the worst first half of a year since 1970.

The latest report released by Commerce Department on Wednesday showed that gross domestic product, the broadest measure of goods and services produced across the economy, shrank by 1.6% on an annualized basis in the three-month period from January through March. The initial report released in April showed GDP shrank by 1.4% on an annualized basis.

The contraction last quarter was the first drop in GDP since the second quarter of 2020 when the U.S. was deep in the throes of the COVID-19 recession. The 2022 drop also followed a robust 6.9% expansion in the final three months of 2021.

Economists expect some slowdown in the economy as the Federal Reserve continues to bump up interest rates to cool inflation and will be looking for indications of whether a full-fledged recession – defined by two consecutive quarters of contractions – is brewing.

All eyes now turn to the agency's release of its advance estimate for second quarter GDP on July 28.

The Atlanta Federal Reserve Bank's GDPNow tracker indicated earlier this month that the economy could be headed for a second-quarter drop in GDP, after showing the economic growth stalled in the spring to a flat 0% – a steep decline from its previous estimate of 1.3% on June 1 and 0.9% on June 8.