U.S. Outlook: U.S. GDP rebounds to a respectable pace in Q2

Scott Anderson
Posted by Scott Anderson
Chief Economist

The Bureau of Economic Analysis’s (BEA) advanced estimate of second quarter real GDP growth showed solid improvement over the first quarter performance, coming in at a 2.6% annualized pace.

Graph showing quarterly GDP growth (actual and projected through next year)Over the first half of this year, U.S. GDP growth was very close to the expansion average at a 1.9% annualized pace.

For more on this, see highlights of my report below, followed by a link to the full U.S. Outlook, delivered on July 28.

Key observations:

  • The rebound was driven by a marked improvement in real consumer spending growth to a 2.8% annualized pace from a 1.9% pace in Q1.
  • The U.S. trade balance improved last quarter, adding almost two-tenths to U.S. GDP growth.
  • The GDP data should give the FOMC the green light to continue on its normalization path and increases the odds of another rate hike from the Fed in December.
  • We forecast Q3 GDP growth at 2.7% and 2017 annual GDP growth of 2.1%.

 

Click here to read my full report.

 

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