Source: Sharecast
US GDP increased at a seasonally adjusted annual rate of 3.0% during the April to June period, well ahead of the 2.5% expansion expected by economists.
That followed a 0.5% economic contraction in the first quarter after a historic jump in imports – as companies front-loaded purchases ahead of the launch of Donald Trump's trade war in April – weighed heavily on output figures. This was the first annual drop in GDP since the first quarter of 2022.
"The increase in real GDP in the second quarter primarily reflected a decrease in imports, which are a subtraction in the calculation of GDP, and an increase in consumer spending," the BEA said in a report.
However, the economy is not out of the woods yet, with decreases in both investment and exports in the second quarter. Exports in particular dropped by 1.8%, after rising 0.4% three months earlier, marking the steepest annual drop in two years.
The closely watched personal consumption expenditures price index was 2.1% ahead of last year, down from a 3.7% increase in the first quarter, with the core PCE figure which excludes food and energy prices) easing to 2.5% from 3.5%.
