The Commerce Department released its third and final estimate of second quarter gross domestic product (GDP) on Thursday, showing an upward revision driven by strong consumer spending.
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GDP grew at an annualized rate of 3.8% during the period, up from the previous estimate of 3.3%. Furthermore, consumer spending grew at a 2.5% pace, above the prior estimate of 1.6%. However, first quarter GDP was revised lower to -0.6% from -0.5%.
Consumer Spending and Fewer Imports Boost Q2 GDP
GDP for the first quarter fell to negative territory for the first time in three years, driven by an uptick in imports as businesses rushed to front-run President Trump’s tariffs. Imports plummeted during the second quarter and contributed to the higher estimate.
“The U.S. consumer remained a lot stronger than many thought, even in the midst of a stock market sell-off and a lot of trade uncertainty,” said Navy Federal Credit Union chief economist Heather Long in an X post.
The Commerce Department will release its first estimate of third quarter GDP on October 30.
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