US Roars Back With 4% GDP Increase in Q2

The US economy grew at an annual rate of 4% during the April-to-June period, latest figures released by the US Department of Commerce have shown.

Consumer spending – which makes up over two-thirds of US economy activity – grew by a robust 2.5%.

Business spending increased by 14% in the world’s largest economy, as businesses restocked inventories.

The growth during the second quarter reverses the contraction seen earlier in the year.

Measured on a quarter-on-quarter basis, GDP grew by 1%.

In the previous quarter, from January to March, the US economy shrank a revised 2.1% on an annualised basis, as a result of harsh winter weather.

However, even with the rebound, the winter is likely to mean overall growth this year will be only 1.6% – less than in 2013.

That could cause the Federal Reserve – which ends a two-day meeting on Wednesday – to continue to keep interest rates low for an extended period into 2015.

via BBC

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