U.S Q2 GDP growth unrevised

U.S. economic growth accelerated in the second quarter at its fastest pace in nearly four years as previously estimated, putting the economy on track to hit the Trump administration’s goal of 3 percent annual growth.

Gross domestic product increased at a 4.2 percent annualized rate, the Commerce Department said on Thursday in its third estimate of GDP growth for the April-June quarter. That was the fastest pace since the third quarter of 2014 and unchanged from the estimate published in August.

The economy grew at a 2.2 percent pace in the January-March period. Upward revisions to spending on residential structures and on nondurable goods like gasoline was offset by a downgrade to inventory investment.

The economy expanded 3.2 percent in the first half of 2018. Growth in the second quarter was driven by the Trump administration’s $1.5 trillion tax cut package, which boosted consumer spending after it almost stalled early in the year.

There was a front-loading to soybean exports to China to beat retaliatory trade tariffs, which also powered growth. Economists had expected second-quarter GDP growth would be unrevised at a 4.2 percent pace.

Reuters

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell