WASHINGTON: The US economy revived in the second quarter after a tepid start to the year, boosted by increased consumer spending and exports, official data released Thursday showed.
Gross domestic product expanded at an annual rate of 2.3 percent in the April-June period, the Commerce Department reported, slightly below the 2.5 percent consensus estimate.
The first quarter, marred by severe winter weather and West Coast port strikes, did not contract as previously estimated. The department said GDP rose 0.6 percent, revised from a 0.2 percent downturn.
According to the first estimate for the second quarter, growth was fueled mainly be an increase in consumer spending, which accounts for about 70 percent of US economic activity.
Consumer spending jumped 2.9 percent in the second quarter, picking up from a 1.8 percent increase in the first. Gains were led by higher spending on goods, with purchases of durable goods such as cars and appliances surging 7.3 percent.
There was a major turnaround in exports, which had been hit in the first quarter by the West Coast ports slowdown that choked traffic.
Exports of goods and services advanced 5.3 percent in the second quarter after plummeting 6.0 percent in the first.
State and local government spending as well as residential fixed investment also added to the rise in growth.
Those contributions were partly offset by declines in federal government spending, inventory investment, business investment and imports, which rose 3.5 percent, about half the prior quarter's increase.
Overall prices rose 1.4 percent in the second quarter after falling 1.6 percent in the first quarter.
Excluding food and energy prices, which can be volatile, prices surged 1.1 percent after a slight 0.2 percent rise.
Analysts said the US economy appeared to have enough momentum to keep the Federal Reserve's plan to raise its key interest rate this year on track.
"Updated GDP numbers deliver a double-punch to US economy doom-mongers, painting a reassuringly bright picture of the health of the US economy so far this year and raising the odds of the Fed hiking interest rates in September," said Chris Williamson, chief economist at Markit.
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