US GDP grew at a 2.4% pace in the second quarter

The U.S. economy showed signs of resilience in the second quarter as gross domestic product (GDP) grew at a faster-than-expected pace of 2.4% annualized. The growth was driven by consumer spending, nonresidential fixed investment, government spending, and inventory growth. The inflation rate was held in check, with the personal consumption expenditures price index rising by 2.6%, lower than the previous quarter. Despite calls for a recession, the economy has shown strong performance, and growth hasn’t posted a negative reading since the second quarter of 2022. The Federal Reserve’s interest rate increases are expected to continue, but the economy has remained robust. Thursday’s report also brought positive news on durable goods orders and weekly jobless claims. Economists have expected the Fed rate increases to lead to a credit contraction and a slowdown in growth, but the economy’s resilience has surprised many. However, signs of potential trouble persist, such as the inverted yield curve, which has a near-perfect record for indicating a recession in the next 12 months.

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