WASHINGTON, 29th August, 2024 (WAM) -- The U.S. economy grew at a healthy 3 percent annual pace in the second quarter of 2024, fuelled by strong consumer spending and business investment, the Associated Press quoted the government as saying on Thursday in an upgrade of its initial assessment.
The Commerce Department had previously estimated that the nation’s gross domestic product – the total output of goods and services – expanded at a 2.8 percent rate from April through June.
The second-quarter growth marked a sharp acceleration from a sluggish 1.4 percent growth rate in the first three months of 2024.
Consumer spending, which accounts for about 70 percent of U.S. economic activity, rose at a 2.9 percent annual rate last quarter, up from 2.3 percent in the government's initial estimate. Business investment expanded at a 7.5 percent rate, led by a 10.8 percent jump in investment in equipment.
Thursday's report reflected an economy that remains resilient despite the pressure of continued high interest rates.
The latest GDP estimate for the April-June quarter also included figures that showed that inflation continues to ease while remaining just above the Federal Reserve’s 2 percent target. The central bank’s favored inflation gauge – the personal consumption expenditures index, or PCE – rose at a 2.5 percent annual rate last quarter, down from 3.4 percent in the first quarter of the year. Excluding volatile food and energy prices, core PCE inflation grew at a 2.7 percent pace, down from 3.2 percent from January through March.
Both the PCE inflation numbers issued Thursday marked a slight improvement on the government's first estimate.
A GDP category that measures the economy’s underlying strength rose at a healthy 2.9 percent annual rate, up from 2.6 percent in the first quarter. This category includes consumer spending and private investment but excludes volatile items such as exports, inventories and government spending.