GDP variation accelerated by about 2% in the first quarter; analysts estimated growth of 1.8% in the period.
The US economy advanced 2.4% in the second quarter, shows the first reading, released this Thursday, 27, by the US Department of Commerce. The variation in the Gross Domestic Product was higher than the market estimate, which was 1.8%, according to Bloomberg.
The pace of growth was above that of the first quarter when the recorded advance was 2%.
The advance in the annualized rate was driven by stronger-than-expected consumer spending and robust business investment.
Meanwhile, the Consumer Expenditure Price Index (PCE) – the indicator of inflation that the Federal Reserve watches in its rate policy decisions – slowed, going from 4.1% in the last reading to 2.6% in the second quarter this year. The core indicator, which excludes volatile energy and food prices, decelerated. The rate increased by 3.80% in the second quarter, below the expected 4% and the 4.9% registered in the previous quarter, below the expected 4% and 4.9% recorded in the last quarter.
The data show a better-than-expected performance of the US economy. While the estimate was of recession for this year, the job market remains strong, the economy is performing better than expected, and now, inflation is slowing down, raising hopes for economic stabilization. On Wednesday, shortly after raising interest rates by 0.25 points, Federal Reserve chairman Jerome Powell said that the monetary authority does not project further recession in the US economy.
The strength of the labor market is an essential support for the economy. Unemployment aid application data, also released this Thursday, show a decline to the lowest level since the end of February. There were 221,000 requests, below the forecast of 235,000 benefits from market economists. The data is also lower than last week, 228 thousand. Continuing claims, which can offer insight into how quickly unemployed Americans can find a new job, have also declined. There were 1.690 million, below the 1.749 million of the previous week.
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