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| US economy accelerates as consumer spending boosts GDP - business live | US economy accelerates as consumer spending boosts GDP - business live |
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| 3.17pm BST | |
| 15:17 | |
| Oxford Economic’s Gregory Daco has tweeted some useful charts, showing how America’s growth rate picked up in the last quarter.... | |
| US #GDP +2.6% Q2: Consumer spend +2.8% & biz invest +5.2%. Inventories +0pp & trade +0.2pp. Solid & compensates weakQ1. Still 2% growth mode pic.twitter.com/zytU1uiQGW | |
| ...and how consumer spending and exports helped drive the recovery. | |
| Composition of US #GDP +2.6% saar Q2 & +2.1% YoY: better consumer spending momentum, stronger global backdrop helps biz invest & trade pic.twitter.com/2wPR5G4GZa | |
| 3.14pm BST | |
| 15:14 | |
| Associated Press have a good take on today’s US growth report. | |
| Here’s a flavour: | |
| The U.S. economy revved up this spring after a weak start to the year, fuelled by a surge in consumer spending. But the growth spurt still fell short of the optimistic goals President Donald Trump hopes to achieve through tax cuts and regulatory relief. | |
| The Commerce Department said Friday that growth in the gross domestic product, the economy’s total output of goods and services, expanded at a 2.6 percent annual rate in the April-June quarter. That’s more than double the revised 1.2 percent pace in the first quarter. | |
| The improvement was powered in large part by robust consumer appetite for items such as clothing and furniture. | |
| The 2.6% GDP gain came in close to economists’ expectations. | |
| “Consumers continue to drive the economy’s growth, but firmer business investment is also a plus,” said Mark Zandi, chief economist at Moody’s Analytics. “Weaker housing construction was the only significant drag on growth in the quarter.” | |
| Trump campaigned on a pledge to boost growth to rates of 4% or better. So far, his economic program has not advanced in Congress. | |
| More here: | |
| US economy expanded at 2.6 percent rate in April-June period, fueled by strong consumer spending. https://t.co/uV7HiWRKvG | |
| 3.03pm BST | |
| 15:03 | |
| Another detail from today’s growth report: | |
| Median quarterly GDP during Obama upgraded to 2.1% #ThanksObama | |
| 2.31pm BST | 2.31pm BST |
| 14:31 | 14:31 |
| Despite accelerating in the last quarter, America’s economy isn’t (yet) achieving the growth rates targeted by Donald Trump. | Despite accelerating in the last quarter, America’s economy isn’t (yet) achieving the growth rates targeted by Donald Trump. |
| Nancy Curtin, chief investment officer at Close Brothers Asset Management, explains: | Nancy Curtin, chief investment officer at Close Brothers Asset Management, explains: |
| “The US economy has improved following a slow start to the year, in spite of a lack of fiscal stimulus so far from Trump’s presidency. A strong performance in export and industrial sectors has been buoyed by weaker dollar, and we’ve seen a steady increase in earnings too. We’re still some way from the President’s 3%+ growth target, but the good news is this wasn’t priced in by the market, so any additional tax relief or infrastructure spending could support markets into year end. | “The US economy has improved following a slow start to the year, in spite of a lack of fiscal stimulus so far from Trump’s presidency. A strong performance in export and industrial sectors has been buoyed by weaker dollar, and we’ve seen a steady increase in earnings too. We’re still some way from the President’s 3%+ growth target, but the good news is this wasn’t priced in by the market, so any additional tax relief or infrastructure spending could support markets into year end. |
| “Despite improving growth, wage inflation remains somewhat elusive, but the labour market remains reasonably strong, and we anticipate the Fed will proceed as planned with its slow and steady programme of interest rate normalisation.” | “Despite improving growth, wage inflation remains somewhat elusive, but the labour market remains reasonably strong, and we anticipate the Fed will proceed as planned with its slow and steady programme of interest rate normalisation.” |
| John Ross of the Renmin University of China shows how growth is close to its long-term average: | John Ross of the Renmin University of China shows how growth is close to its long-term average: |
| US GDP year on year growth slight increase in Q2 to 2.1% from 2.0% in Q1. Reflects recovery from very low growth in 2016. pic.twitter.com/c6zBCdpQB8 | US GDP year on year growth slight increase in Q2 to 2.1% from 2.0% in Q1. Reflects recovery from very low growth in 2016. pic.twitter.com/c6zBCdpQB8 |
| 2.08pm BST | 2.08pm BST |
| 14:08 | 14:08 |
| Andrew Hunter of Capital Economics says America’s economy is benefitting from consumer spending and business investment: | Andrew Hunter of Capital Economics says America’s economy is benefitting from consumer spending and business investment: |
| The 2.6% annualised gain in real GDP in the second quarter was driven by a rebound in real consumption growth, and suggests that GDP is still on track for growth of around 2.2% for 2017 as a whole. This should convince the Fed that, despite the recent weakness of core inflation, the real economy remains in good shape. | The 2.6% annualised gain in real GDP in the second quarter was driven by a rebound in real consumption growth, and suggests that GDP is still on track for growth of around 2.2% for 2017 as a whole. This should convince the Fed that, despite the recent weakness of core inflation, the real economy remains in good shape. |
| Real consumption increased by 2.8% annualised, up from 1.9% in the first quarter. Furthermore, business investment posted a healthy 5.2% annualised gain, although residential investment declined by nearly 7%. The weakness in the latter is unlikely to last. Meanwhile, after subtracting a massive 1.5% points from growth in the first quarter, inventories were a negligible drag in the second. | Real consumption increased by 2.8% annualised, up from 1.9% in the first quarter. Furthermore, business investment posted a healthy 5.2% annualised gain, although residential investment declined by nearly 7%. The weakness in the latter is unlikely to last. Meanwhile, after subtracting a massive 1.5% points from growth in the first quarter, inventories were a negligible drag in the second. |
| The annual revisions didn’t change much, with growth in the previous two quarters revised down slightly, and growth for 2016 as a whole nudged down to 1.5%, from 1.6%. | The annual revisions didn’t change much, with growth in the previous two quarters revised down slightly, and growth for 2016 as a whole nudged down to 1.5%, from 1.6%. |
| 1.55pm BST | 1.55pm BST |
| 13:55 | 13:55 |
| US GDP: Instant reaction | US GDP: Instant reaction |
| Heather Long of the Washington Post says the acceleration in US growth in the last quarter isn’t exceptional. | Heather Long of the Washington Post says the acceleration in US growth in the last quarter isn’t exceptional. |
| She points out that America’s economy usually accelerates in April-June.... | She points out that America’s economy usually accelerates in April-June.... |
| The US economy is still chugging along: 2.6% growth in Q2. Keep in mind: Q2 GDP is often a big rebound from Q1 pic.twitter.com/QCHAnvtAlL | The US economy is still chugging along: 2.6% growth in Q2. Keep in mind: Q2 GDP is often a big rebound from Q1 pic.twitter.com/QCHAnvtAlL |
| Yes, economy grew more in Q2. That's typical. No sign of "Trump bump" yet in GDP.Q2 2017: 2.6%Q2 2016: 2.2%Q2 2015: 2.7%Q2 2014: 4.6% | Yes, economy grew more in Q2. That's typical. No sign of "Trump bump" yet in GDP.Q2 2017: 2.6%Q2 2016: 2.2%Q2 2015: 2.7%Q2 2014: 4.6% |
| Jason Furman, one of President Obama’s economy advisors, says the economy has grown at its trend level this year. | Jason Furman, one of President Obama’s economy advisors, says the economy has grown at its trend level this year. |
| GDP growth of 2.6% in Q2 means the first half continues trend potential ~2%. PDFP tells the same story at 2.7% in Q2. | GDP growth of 2.6% in Q2 means the first half continues trend potential ~2%. PDFP tells the same story at 2.7% in Q2. |
| Patrick Chovanec of Silvercrest Asset Management is encouraged the businesses kept investing. | Patrick Chovanec of Silvercrest Asset Management is encouraged the businesses kept investing. |
| Q1's +7.2% surge in fixed business investment moderated to a still-respectable +5.2% in Q2, adding +0.6 points to GDP growth. | Q1's +7.2% surge in fixed business investment moderated to a still-respectable +5.2% in Q2, adding +0.6 points to GDP growth. |
| Updated | Updated |
| at 1.56pm BST | at 1.56pm BST |
| 1.46pm BST | 1.46pm BST |
| 13:46 | 13:46 |
| US companies helped the American economy grow in the last quarter, according to today’s GDP report. | US companies helped the American economy grow in the last quarter, according to today’s GDP report. |
| Business spending on equipment rose by 8.2% in the last three months, the fastest since the third quarter of 2015. | Business spending on equipment rose by 8.2% in the last three months, the fastest since the third quarter of 2015. |
| Spending on mining exploration, wells and shafts more than doubled, while investment on nonresidential structures increased at a 4.9% pace. | Spending on mining exploration, wells and shafts more than doubled, while investment on nonresidential structures increased at a 4.9% pace. |
| Trade added 0.18 percentage point to growth, but investment on homebuilding shrank by 6.8%. | Trade added 0.18 percentage point to growth, but investment on homebuilding shrank by 6.8%. |
| 1.36pm BST | 1.36pm BST |
| 13:36 | 13:36 |
| US growth rate hits 2.6% for Q2 | US growth rate hits 2.6% for Q2 |
| Breaking: The US economy grew at an annualised rate of 2.6% in the second quarter of 2017, more than twice as fast as in Q1. | Breaking: The US economy grew at an annualised rate of 2.6% in the second quarter of 2017, more than twice as fast as in Q1. |
| That’s the equivalent of 0.65% quarter-on-quarter growth; double Britain’s 0.3% growth rate,and quicker than France’s 0.5% growth too. | That’s the equivalent of 0.65% quarter-on-quarter growth; double Britain’s 0.3% growth rate,and quicker than France’s 0.5% growth too. |
| American GDP was driven by consumer spending, which grew by 2.8%. | American GDP was driven by consumer spending, which grew by 2.8%. |
| Net trade also contributed to growth, with exports up 4.1% and imports up only 2.1%. | Net trade also contributed to growth, with exports up 4.1% and imports up only 2.1%. |
| This is a significant acceleration compared to the first quarter, where growth has been revised down to 1.2% annualised growth (or 0.3% quarter-on-quarter). | This is a significant acceleration compared to the first quarter, where growth has been revised down to 1.2% annualised growth (or 0.3% quarter-on-quarter). |
| But it’s very slightly below the consensus forecast, of 2.7% annualise growth. | But it’s very slightly below the consensus forecast, of 2.7% annualise growth. |
| Here are some highlights of Q2 GDP https://t.co/BxyP42QYoi pic.twitter.com/jN0jNpQ9S9 | Here are some highlights of Q2 GDP https://t.co/BxyP42QYoi pic.twitter.com/jN0jNpQ9S9 |
| More to follow.... | More to follow.... |
| 1.19pm BST | 1.19pm BST |
| 13:19 | 13:19 |
| It’s nearly time for the biggest event of the day - the first estimate of US GDP in the second quarter of the year. | It’s nearly time for the biggest event of the day - the first estimate of US GDP in the second quarter of the year. |
| Wall Street’s finest minds agree that the growth rate probably rebounded after slowing in Q1, although they don’t agree by how much.... | Wall Street’s finest minds agree that the growth rate probably rebounded after slowing in Q1, although they don’t agree by how much.... |
| Countdown to Q2 US GDP:Consensus: 2.6%Atlanta Fed: 2.8%NY Fed: 2.0%Goldman Sachs: 2.2%JPM: 3.5%Barclays: 2.7%Citi 2.9% | Countdown to Q2 US GDP:Consensus: 2.6%Atlanta Fed: 2.8%NY Fed: 2.0%Goldman Sachs: 2.2%JPM: 3.5%Barclays: 2.7%Citi 2.9% |
| These figures are all annualised, so divide by four to get the true quarterly growth rate.... | These figures are all annualised, so divide by four to get the true quarterly growth rate.... |
| The figures land at 1.30pm BST, or 8.30am in Washington.... | The figures land at 1.30pm BST, or 8.30am in Washington.... |
| 1.06pm BST | 1.06pm BST |
| 13:06 | 13:06 |
| The Economist Intelligence Unit have hailed Sweden’s eye-catchingly fast growth: | The Economist Intelligence Unit have hailed Sweden’s eye-catchingly fast growth: |
| Spectacular Q2 GDP in #Sweden. Even if economy stagnates in Jul-Dec, full-yr growth will now be ~3%. We'll be bumping up our f'cast of 2.3%. pic.twitter.com/9bnkEFAeCV | Spectacular Q2 GDP in #Sweden. Even if economy stagnates in Jul-Dec, full-yr growth will now be ~3%. We'll be bumping up our f'cast of 2.3%. pic.twitter.com/9bnkEFAeCV |
| 12.38pm BST | 12.38pm BST |
| 12:38 | 12:38 |
| Greek PM: Growth is like getting our sovereignty back | Greek PM: Growth is like getting our sovereignty back |
| Helena Smith | Helena Smith |
| Economic issues are also on the agenda in Greece today, where prime minister Alexis Tsipras has been hailing its return to growth earlier this year. | Economic issues are also on the agenda in Greece today, where prime minister Alexis Tsipras has been hailing its return to growth earlier this year. |
| Helena Smith our correspondent in Athens, reports: | Helena Smith our correspondent in Athens, reports: |
| Addressing the second in a series of regional growth conferences in the central town of Lamia, the leftist leader declared that economic recovery was now the equivalent of thrice-bailed out Greece regaining its national sovereignty. | Addressing the second in a series of regional growth conferences in the central town of Lamia, the leftist leader declared that economic recovery was now the equivalent of thrice-bailed out Greece regaining its national sovereignty. |
| He told an audience of local business leaders, politicians and regional officials that: | He told an audience of local business leaders, politicians and regional officials that: |
| “The goal of growth is connected to the very existence of our nation, our national sovereignty, the prosperity of our people, our children.” | “The goal of growth is connected to the very existence of our nation, our national sovereignty, the prosperity of our people, our children.” |
| Tsipras said that Greece is finally heading out of seven long dark years, after returning to the financial markets on Monday with its first bond sale since 2014. The government hopes to repeat that test run soon, as it prepared to exit its current €86bn bailout programme in August 2018. | Tsipras said that Greece is finally heading out of seven long dark years, after returning to the financial markets on Monday with its first bond sale since 2014. The government hopes to repeat that test run soon, as it prepared to exit its current €86bn bailout programme in August 2018. |
| The prime minister had made a similar pledge in an exclusive interview with the Guardian on Monday in which he described Greece’s regaining of economic sovereignty as a “priority.” | The prime minister had made a similar pledge in an exclusive interview with the Guardian on Monday in which he described Greece’s regaining of economic sovereignty as a “priority.” |