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U.S. Outlook: Economy runs hot in the second quarter
Chief Economist
Second quarter real GDP pierced the 4.0% barrier, as we expected, with the advance estimate from the BEA coming in at a sizzling 4.1%.
The above-trend growth was driven by a number of factors.
For more on this, see highlights of my report below, followed by a link to the full U.S. Outlook, delivered on July 27.
Key observations:- Consumer spending alone was responsible for 2.7 percentage points of the 4.1% gain in U.S. real GDP growth last quarter.
- We forecast real consumer spending growth of around 2.4% annualized in the third quarter.
- GDP growth would have been a lot stronger last quarter if there weren’t a big drop in business inventories.
- Bottom line: The 4.1% Q2 GDP print was impressive, but not sustainable in the quarters ahead.
