U.S. Economic Growth Slowed to 1.5% in Second Quarter, Falling Short of Expectations
Imports and slower inventory growth dragged on output even as consumer spending and artificial intelligence investment stayed strong, economists said.
- The Commerce Department reported Thursday that U.S. GDP expanded at a sluggish 1.5% pace from April through June, while the Federal Reserve's favored PCE inflation measure rose 3.7% last month.
- Economic growth decelerated from 2.1% in the first three months of 2026, as rising imports weighed on the nation's output of goods and services during the second quarter.
- Excluding volatile food and energy prices, core consumer prices rose 3.3% from a year earlier, while employers added an average 92,000 jobs per month this year, sustaining consumer spending power.
- On Wednesday, the Fed kept its benchmark interest rate unchanged for the fifth consecutive meeting, though three regional Fed presidents dissented, arguing for higher rates to combat elevated inflation.
- Ahead of November's midterm elections, higher costs have frustrated Americans, creating a critical test for President Donald Trump and Republicans who currently hold full control of Congress.
194 Articles
194 Articles
Los Angeles Times
The U.S. economy expanded at a slow rate of 1.5% from April to June while the increase in imports costed growth, although consumer spending increased.
AI-related imports prove to be drag on US growth
The US economy grew more slowly than expected in the second quarter, as AI-related imports weighed on otherwise robust economic data. Consumer spending picked up despite inflation and business investment driven by the AI buildout remained strong, but that AI boom cut against overall growth, as the country imported more semiconductors. The economy in the first 18 months of US President Donald Trump’s tenure has withstood a “series of policy-drive…
US economy grows at sluggish 1.5% in second-quarter with inflation remaining high
The U.S. economy expanded at a sluggish 1.5% pace from April through June as rising imports weighed on growth, yet consumers continued to spend. The Federal Reserve’s favored measure of inflation grew more slowly last month. But it remained above the central bank’s 2% target at a time when Americans are frustrated about the high cost of living ahead of the midterm elections, now less than 100 days away. Growth in U.S. gross domestic product — th…
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