Economy Grows at 2.8% Clip in 2Q
he economy grew at a 2.8% annual rate in the second quarter, slower than 3% clip estimated a month ago, as consumer spending grew at the weakest pace since the recession in 2001, the Commerce Department said Friday.
Gross domestic product, the value of all goods and services produced, had expanded at a 4.5% rate in the first quarter.
Consumer spending, which accounts for about 70% of the economy, grew at a 1.6% annual rate in the April through June period, compared with the 1% reported last month and the 4.1% rate in first three months of the year.
Inventories grew $57.7 billion at an annual rate, up from the $47.5 billion rate the government reported earlier. Stockpiles grew at a $40 billion rate in the first quarter.
Government spending rose 2.4% annual pace in the quarter, compared with a rise of 2.5% in the first quarter.
The core personal consumption expenditures index, watched by Federal Reserve policy makers, rose at a 1.7% annual rate in the second quarter, Commerce said.
Adjusted for inflation, GDP totaled $10.8 trillion in the second quarter when measured at an annual rate. Unadjusted, GDP rose at 6.1% annual rate, and totaled $11.6 trillion, after rising at a 7.4% pace in the first quarter.
