US Economy Expands 2.6% in 2Q

  • US Economy Expands 2.6% in 2Q

The U.S. economy rebounded in the second quarter following pickups in consumer and business spending.

The economy expanded 2.6 percent in the second quarter, up from 1.2 percent recorded in the first quarter, according to the Commerce Department report on Friday.

Consumer spending that contributed the most to the economy grew 2.8 percent, while exports and imports climbed 4.1 percent and 2.1 percent respectively. Indicating that weak US dollar is aiding overseas sales, and mainly responsible for the surge in the earnings of manufacturing companies in the second quarter.

Also, business investment in equipment rose the most in almost two years, growing at 8.2 percent rate. Signaling surge in business confidence among business owners about both domestic and overseas markets.

While political challenges continued to impede the passage of key policies of the Trump’s administration, experts believed weak US dollar and the healthy labor market will continue to sustain growth.

However, few have said if the administration pushes ahead with its protectionism agenda, gains from weak dollar due to overseas sales would be hurt.

The US dollar has lost about 12 percent against the Euro-single currency this year, reaching 1.1775. More than 2 year low.

The Federal Reserve left rates unchanged but indicated its readiness to commence balance sheet normalization as early as October.

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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