The Commerce Department reports that the US economy grew at an annual rate of 1.5% in the second quarter.
The Commerce Department reported that the US economy grew at an annual rate of 1.5% in the second quarter, a figure lower than the 1.8% growth rate expected by economists. This growth was slightly lower than the 2.1% increase seen in the first quarter. The Commerce Department noted that while the top-line GDP figure was below expectations, the miss was primarily due to a decline in federal government spending and inventories. Other parts of the economy remained solid, with personal spending rising 2.1% and final sales to private domestic purchasers posting a robust 3.9% increase. Inflation remains a primary concern for the Federal Reserve, as the personal consumption expenditures price index fell 0.1% for the month, leaving the annual inflation rate at 3.7%. This remains well above the Federal Reserve's 2% target. Despite the slowdown in growth, economists like Bradley Saunders noted that the statistics show a healthy economy where households have shrugged off the impact of higher fuel prices. The Federal Reserve indicated that economic activity is expanding at a solid pace despite the Middle East conflict's impact on oil prices.