- U.S. Second Quarter GDP Revised Up to 3%
The U.S. second quarter growth rate was revised up as data showed stronger consumer spending and a surge in business investment, Commerce Department report showed on Wednesday.
The economy grew by 3 percent year on year in the second quarter, higher than the previously estimated 2.6 percent and the 2.7 percent growth rate predicted by economists.
Consumer spending, the largest part of the economy, rose 3.3 percent, revised upward from 2.8 percent and better than the 3 percent forecast by analysts.
While fixed investment climbed by 6.9 percent, also revised upward from the initial increase of 5.2 percent.
The new data indicate the economic momentum going into the second half of the year was greater than previously thought, therefore, the value of goods and services produced may be broadening beyond household spending.
According to the report, spending on used cars, wireless-phone services and electricity and natural gas were higher in the second quarter. Once again, affirming the importance of consumer spending to the current growth.
New business spending got a boost from software, helping intellectual-property investment rise at a 4.9 percent pace, up from an initially reported 1.4 percent.
However, even though the economic growth rate is in line with Trump’s target, economists believed it is unlikely it would be sustained going forward. Especially with growing uncertainties and the inability of the administration to pull through with the tax cut and other agenda.
The US dollar plunged to a two-year low on Tuesday against the Euro-single currency to trade at $1.2069.