U.S. Economic Growth Slowed to 1.5% in Second Quarter, Falling Short of Expectations
The Commerce Department said consumer spending and business investment helped offset a 1 percentage point hit from trade.
- 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.
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The activity cools and slows the pace in full offensive against Iran and with the energy markets scrambled. The quarterly progression of the GDP stays at 0.4%
Market expectations were that the US Gross Domestic Product (GDP) would grow by 2.1% during the second part of the year.
U.S. Growth Slows Amid Trade Deficit Rise, Consumer Spending Boost
U.S. economic growth decelerated to 1.5% in Q2 due to a widening trade deficit, despite robust consumer spending and AI investments. Concerns over the Middle East conflict and rising inflation pose risks for H2 growth, with the Fed maintaining interest rates, and potential hikes expected to curb inflation.
U.S. gross domestic product (GDP) growth slowed to an annualized 1.5 percent in the second quarter from a 2.1 percent pace in the first quarter, the U.S. Commerce Department said in a flash estimate on Thursday.
US economic growth slows in second quarter, missing expectations
GDP grew at a sluggish annualized rate of 1.5 percent in the second quarter, the Bureau of Economic Analysis said, missing analyst expectations of around 2.0 percent. It had grown by 2.1 percent in the previous quarter, BEA data showed. "Compared to the first quarter, the deceleration in real GDP in the second quarter reflected a downturn in government spending and decelerations in investment and exports that were partly offset by an acceleratio…
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