U.S. Economy Outperforms Expectations in 2nd Quarter

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The U.S. economy gained momentum from April through June, growing faster than expected as consumers continued spending despite rising interest rates. According to the advance estimate for real gross domestic product (GDP) recently released by the Bureau of Economic Analysis, real GDP grew at an annualized rate of 2.4% in 2nd quarter 2023. That was higher than the growth rate in the first three months of the year which was revised up to 2%. The recent economic expansion also exceeded economists’ expectations of 1.8% growth. The increase in real GDP during 2nd quarter primarily reflected increases in consumer spending (in both goods and services), nonresidential fixed investment, government spending and private inventory investment. Those increases were partly offset by decreases in exports and residential fixed investment. The recent GDP estimate will be revised several more times based on more complete source data. The second estimate for 2nd quarter 2023 GDP will be released on August 30.