The US economy grew at a 3 per cent annual rate from April to June quarter or the second quarter, thanks to strong consumer spending, private inventory investment, and non-residential fixed investment, the US government said on Thursday.
The Bureau of Economic Analysis (BEA) of the US reported that the gross domestic product (GDP) growth was higher in the second quarter than the 1.6% annual rate in the first quarter.
“Compared to the first quarter, the acceleration in real GDP in the second quarterly primarily reflected an upturn in private inventory investment and an acceleration in consumer spending. These movements were partly offset by a downturn in residential fixed investment,” a BEA release said.
The BEA said the personal consumption expenditures (PCE) price index increased 2.5 per cent, in line with the previous estimate. The PCE price index, excluding food and energy prices, increased by 2.8 percent, which is the same as the previous estimate.
Real gross domestic income (GDI) rose by 3.4 per cent in the April to June quarter. GDI estimates the purchasing power of a country's total income from domestic production.
The consumer price index (CPI) dipped by 2.5 per cent in August from a year ago, the lowest since February 2021, the US Bureau of Labor Statistics said on September 11. The August CPI was at a three-year low due to lower gasoline prices.
On September 18, the US Federal Reserve cut down the benchmark interest rate by 50 basis points (bps) or half a percentage point to 4.75 per cent-5 per cent for the first time in four years, in line with the estimates.
On Thursday, the BEA revised the previous GDP estimates. From 2018 to 2023, growth rose on an average of 2.3% annually, from 2.1% estimated previously mainly due to rising revisions to consumer spending.
The report presented on September 26 is the US government's third and final estimate of GDP growth for the April-June quarter. The next release of initial GDP estimates for the third quarter from July to September will be on October 30.
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