US GDP Growth Slows to 1.5% in Q2 as Consumer Spending Stays Robust
US GDP grew at a 1.5% annual rate in Q2, down from 2.1% in Q1, as a surge in imports offset strong consumer spending.
The US economy expanded at a modest 1.5% annual pace in the second quarter, according to the Commerce Department's latest estimate released Wednesday. This marks a slowdown from the 2.1% growth recorded in the first three months of the year, and the figure was unchanged from the department's initial reading.
Despite the overall sluggish headline number, consumer spending — which drives roughly 70% of US economic activity — remained a bright spot. Household outlays grew at a healthy 3.4% annual rate from April through June, a sharp acceleration from the 0.5% pace seen in the January-March period.
The primary drag on growth came from imports, which are subtracted from GDP calculations since the metric only counts domestic production. Imports surged at a 12.5% annual rate during the quarter, partly driven by a spike in shipments of computer chips and other components tied to artificial intelligence investment. This import surge shaved 1.64 percentage points off second-quarter growth.
Business investment, however, rose during the period, reflecting continued momentum in the AI sector. The US economy has shown notable resilience despite geopolitical tensions with Iran and the resulting spike in energy prices.
Wednesday's report is the second of three Commerce Department assessments of second-quarter GDP. The final, revised figure is scheduled for release on September 30.