MNI BRIEF: US 2Q Growth Picks Up To 2.8%, Above Estimates
MNI (WASHINGTON) - U.S. GDP growth accelerated to a 2.8% pace in the second quarter, above analyst estimates for a 2.0% increase, while core PCE inflation dipped to 2.9% but also came in hotter than expected, according to the Bureau of Economic Analysis Thursday. A separate report from the Labor Department showed initial and continuing jobless claims were also lower than forecast for the past week.
The data had little impact on traders' expectations of a September interest rate cut by the Federal Reserve. (See: MNI INTERVIEW: Fed Could Be Forced To Play Catch Up - Coronado)
Strong consumer spending, inventory accumulation and nonresidential fixed investment drove the increase in growth last quarter, the BEA said. Final sales to private domestic purchasers, a broad measure of demand, rose 2.6%, same as the first quarter. Core PCE inflation slowed from 3.7% in the first quarter but was above the 2.7% analysts expected.