Washington, United States – Economic growth in the United States was weaker than first estimated for the April to June period, the Commerce Department said Wednesday, noting downward revisions in business investment.
GDP growth in the world’s biggest economy came in at 2.1 percent for the second quarter, down from the initial estimate of 2.4 percent released in July.
The updated growth figure is still slightly above the pace in the first three months of 2023, but could be encouraging to policymakers who have been seeking to cool the economy.
Economists have been warning of a possible downturn as the US central bank rapidly lifted interest rates to tamp down demand and lower inflation.
But the economy has proven more resilient than anticipated, boosting hopes of a “soft landing” where inflation comes down without triggering a recession.
“The updated estimates primarily reflected downward revisions to private inventory investment and nonresidential fixed investment,” the Commerce Department said.
This was “partly offset by an upward revision to state and local government spending.”
While the acceleration in GDP growth from the first to second quarter this year was mainly driven by investment shifts, official data noted a downturn in exports and slowdown in consumer spending as well.