The U.S. economy expanded at a markedly slower-than-anticipated rate during the second quarter, with real GDP climbing just 1.5%, according to the first estimate released Thursday by the Bureau of Economic Analysis. The reading fell significantly below the 2.0% median forecast, signaling a deceleration in economic momentum heading into the latter half of the year.
Consumer spending and business investment provided support for growth, while exports also contributed positively to the overall GDP figure. However, these gains were partially dampened by a contraction in government spending, which offset some of the momentum from the private sector. The mixed drivers underscore an economy navigating competing pressures between resilient household demand and fiscal headwinds.
The weaker-than-expected growth underscores lingering questions about the sustainability of the economic expansion amid elevated interest rates and shifting policy dynamics. Economists will be monitoring whether the second-quarter deceleration reflects seasonal factors or signals a more persistent slowdown in economic activity going forward.