U.S. Economy Grows At 3% in the Second Quarter

Published on: 30 Aug, 2017

The U.S. economy was revised to grow faster than expected in the second quarter due to strong consumer spending and robust business investment.

Gross domestic product rose at an annualized 3.0 percent in the second quarter, the fastest pace in more than two years, according to the data from the Commerce Department. The number is revised from initial estimate of 2.6 percent last month. Economists had expected the GDP to grow at a 2.7 percent rate.

Strong consumer spending help boost the economy growth. Consumer Spending, which accounts for two-thirds of U.S. economy, grew at a 3.3 percent rate, revised up from the 2.8 percent in July. That was boosted by sending on housing, utilities, motor vehicles, and cellphone services.

Business investment also contributed to the economy growth in the second quarter. Spending on equipment and intellectual-property investment were revised up separately to 8.8 percent and 4.9 percent.

President Donald Trump has a target growth rate of 3.0 percent for the full year. But he still failed to implement his tax reform and infrastructure plan to stimulate the economy.

"Overall the U.S. economy and labor market remain in good shape, and will easily withstand any temporary drag from Harvey," Gus Faucher, chief economist at PNC Financial, wrote in a report on Wednesday.


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