Washington
—
The US economy’s comeback in the second quarter was just revised higher again, and economists estimate that momentum carried on in the third quarter, underscoring the resilience of the world’s largest economy.
Gross domestic product, the broadest measure of economic output, rose at an annualized rate of 3.8% from April through June, the Commerce Department said Thursday in its third and final estimate. That’s significantly higher than the 3.3% rate reported in the second estimate, and well above the 3% initially reported.
GDP was revised higher largely due to new additional data on consumer spending. Personal consumption expenditures rose at an annualized pace of 2.5% in the second quarter, according to the third estimate, up sharply from the second estimate’s 1.6%.
But the economic story of the second quarter remains the same: Falling imports and US consumers who kept on spending helped fuel the rebound during the spring, following a contraction in the beginning of the year when importers stocked up on inventories to get ahead of President Donald Trump’s tariffs, which subtracted from GDP.
The Federal Reserve Bank of Atlanta estimates that GDP continued to power through at a robust pace in the third quarter, forecasting third-quarter GDP to register at a solid 3.3% rate.
The government’s first estimate of third-quarter GDP is scheduled to be released next month.
“Thursday’s upward GDP revision for the second quarter confirmed that the economy grew at a healthy clip, even as tariff uncertainty reached fever pitch during the quarter,” Paul Stanley, chief investment officer at Granite Bay Wealth Management, wrote in an analyst note Thursday. “The US economy is resilient and the strong GDP is another indication that we are not at risk of any kind of recession, even with slowing labor market growth.”
This story is developing and will be updated.
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