The economy was not doing as well as first reported in March and April, according to revised data with more complete information released Monday.

Business inventories dropped 0.3% in March, considerably less than the decline assumed in the first quarter GDP report. Sales fell the same percentage, so the inventory to sales ratio remained at 1.37, about two days of surplus inventory. Industrial production fell 0.3% in April and the March change was revised from +0.4 to -0.1%, mostly for capital equipment and industrial materials.
These sobering reports suggest that recovery to last summer's peak level of production may not occur until very late this year, although production should be rising slowly by the beginning of the summer. The change in freight volume should follow a similar pattern, but with recovery a little faster because some of the inventory being used up has to be moved.
The anticipated "V" shaped economic slowdown/recovery is now stretching out toward a "U" shape. Durable goods manufacturers, especially communications equipment and semiconductor manufacturers, did not shut down fast enough or long enough to eliminate surplus inventory before the impact of slower spending growth ignited small, scattered, cutbacks in the much larger, non-durables and services sectors.
Good weather boosted April retail sales 0.8%, so inventories almost certainly declined last month and probably the inventory to sales ratio as well. Nonetheless, several more sluggish months are likely for the economy before there is a sustained upturn in spending and freight.