US economic growth in the second quarter was weaker than expected


U.S. GDP update

U.S. economic growth rose slightly to 6.5% in the second quarter on an annual basis, which was lower than expected, as strong consumption was partially offset by lagging real estate investment and inventory reduction.

The data released by the US Department of Commerce on Thursday was lower than the 8.5% annual growth rate expected by economists, compared with 6.3% in the first quarter.

Nevertheless, for the first time since the Covid-19 outbreak, U.S. output has returned to above pre-pandemic levels, and economists expect strong growth for the rest of the year.

According to the measurement used by other large economies, GDP increased by 1.6% from the previous quarter.The weakest part of the report is residential investment and inventory, which exposes Labor shortage and Supply chain disruption It is slowing down the unusually strong US expansion.

Coronavirus resurgence in some parts of the country Delta variant It has raised concerns about the prospects of the US economy in the coming weeks and months. After a steady decline this spring, the number of cases just started to rise again at the end of the second quarter.

Personal consumption is the strongest component of GDP data, with an annualized growth rate of expenditure of 11.8%, compared with 11.4% in the first quarter.Millions of American households receive Irritation check From mid-March to early April, as economic activity rebounded from the depths of the pandemic, a shopping boom was triggered.

But private domestic investment fell by 3.5% this quarter, dragged down by the decline in residential investment and commercial construction spending. However, in other areas, business investment is strong.

The data is also highlighted Rising inflationThe PCE price index rose 6.4%, compared with a 3.8% increase in the first quarter. The core PCE index, which excludes fluctuating food and energy costs, rose 6.1%, after rising 2.7% in the first quarter.

Economists are divided on the strength of the US recovery in the second half of the year.

“Although the data in the second quarter is generally disappointing, the continued strength of private demand is very encouraging and should allow the economy to maintain strong momentum in the second half of the year and 2022,” said Jefferies economist Aneta Markowska , And cited a strong household balance sheet and inventory replenishment. She expects the annual growth rate in the second half of the year to reach 7.5%.

Others are more worried. “The good news is that the economy has now surpassed its pre-pandemic level. But as the impact of fiscal stimulus measures weakened, soaring prices weakened purchasing power, the delta variable is rampant in the South, and the savings rate is lower than we expected, we expect the actual rate in the second half of the year. The GDP growth rate will slow to 3.5%. This year,” said Paul Ashworth, chief economist of Capital Macros North America.


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