×

The US economy’s 2Q went from solid to stellar

WASHINGTON – The U.S. economy staged a far bigger rebound last quarter than first thought, outpacing the rest of the developed world and bolstering confidence that it will remain sturdy in coming months despite global headwinds.

The economy as measured by gross domestic product expanded at an annual rate of 3.7 percent in the April-June quarter, the Commerce Department reported Thursday. That’s more than a percentage point greater than the initial 2.3 percent estimate and a sharp upgrade from the anemic 0.6 percent advance during the January-March quarter.

President Barack Obama took note of the good GDP report, saying it showed America remains “an anchor of global strength and stability” with an economic recovery that has been faster and stronger than most other nations.

“It’s important to remember that strength. There’s been a lot of reports in the news, stock markets swinging, worries about China and about Europe,” Obama said during a tour of New Orleans to see rebuilding efforts since Hurricane Katrina 10 years ago.

To be sure, the GDP report provides a backward look at the U.S. economy. Since the spring, it has been hit with deepening concerns about a slowdown in China and recent turbulence in global financial markets. It remains unclear how the U.S. will fare in the months ahead if developments abroad deteriorate.

The robust second-quarter numbers, however, indicate a level of growth unmatched by the rest of the developed world and a solid footing heading into the second half of the year.

“The U.S. economy entered the current market turbulence with momentum, which will help it to shrug off the drag from China and other developing economies,” said Diane Swonk, chief economist at Mesirow Financial.

Newsletter

Today's breaking news and more in your inbox

I'm interested in (please check all that apply)
Are you a paying subscriber to the newspaper? *
   

Starting at $4.38/week.

Subscribe Today