GDP growth softens to 1.7% in 2Q
The U.S. real gross domestic product, which is the output of goods and services by labor and property, increased at an annual rate of 1.7% in the second quarter, according to the third estimate from the Commerce Department. The second quarter results released today is a based on "more complete source data" than the initial estimate of second quarter GDP growth at 2.4%, which at that time was lower than expected. Its second estimate for the second quarter was a 1.6% growth in GDP. In the first quarter, the GDP increased 2.7%. According to the Commerce Department, the latest estimated growth comes from "positive contributions" from personal consumption expenditures, both nonresidential and residential fixed investment, exports, and government spending. However, imports, which is a subtraction from GDP calculations increased in the second quarter. The slowdown in GDP growth, however, from previous increases came from a "sharp acceleration in imports" and lower investments in private inventory here in the states. While exports of goods increased 9.1% in the second quarter, imports increased 33.5% in the same period. While initial jobless claims fell 3.5% last week to the level seen at the beginning of the year, the economy still has a way to go to correct from the recession and return more jobs. Barclays Capital analysts predicted stronger GDP growth to come in the third quarter as risks of a double-dip could recede. Write to Jon Prior.