US economic growth slowed less than expected in the second quarter

WASHINGTON (Reuters) – US economic growth has slowed less than expected in the second quarter as consumer spending has sharply reduced the drop due to falling exports and the pace of inventories, which could allay concerns about the strength of the economy. l & # 39; economy.

The Commerce Department's relatively optimistic report will probably not prevent the Federal Reserve from raising interest rates next Wednesday for the first time in 10 years, given the growing risks of the economic outlook, as particular because of the US-China trade war.

Despite a higher than expected GDP reading, investment fell for the first time since early 2016 and the housing sector declined for a sixth consecutive quarter.

Federal Reserve Chairman Jerome Powell said earlier this month that business and housing investment were weak sectors of the economy.

The government said GDP grew at an annual rate of 2.1 percent in the second quarter. The economy grew at an unadjusted rate of 3.1% in the quarter from January to March.

Economists polled by Reuters forecast GDP growth of 1.8% in the second quarter.

Consumer spending, which accounts for more than two-thirds of US economic activity, rose 4.3% in the second quarter, the fastest pace recorded since the fourth quarter of 2017. Consumer spending has increased by 1.1% in the first quarter.

(Reuters)