U.S. economic growth decelerated in the second quarter by more than initially reported, suggesting President Donald Trump’s trade actions are weighing more heavily on the pace of expansion.
Inflation-adjusted gross domestic product grew at a 2% annualized rate, according to Commerce Department data Thursday that matched analyst estimates and compared with an initially reported 2.1%. Consumer spending, which makes up about two-thirds of the economy, grew 4.7%, topping all forecasts with the biggest gain since 2014.
The stronger consumption was offset by weaker readings across other categories, including exports, inventories, residential investment and state and local government spending.
The report signals Trump’s 3% annual growth goal may be even more out of reach as the world’s largest economy faces complications from his tariffs on Chinese goods, which may further weigh on the outlook with levies set to increase Sept. 1. Investors have sent bond yields plummeting while economists project weaker growth in the second half and have boosted odds that the record-long expansion will end in the next 12 months.
Following the report, Trump tweeted yet another barb at the Federal Reserve. He wrote, “The Economy is doing GREAT, with tremendous upside potential” and “if the Fed would do what they should, we are a Rocket upward!”
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