The Bureau of Economic Analysis (BEA) on Wednesday released its final reading of\u00a0second-quarter GDP<\/a>, which showed the economy grew at an annualized rate of 2.2% in the three-month period including April, May and June.<\/p>\n That figure topped the expectations of economists polled by LSEG, who had estimated 1.5% GDP growth in the second quarter.<\/p>\n It comes after the U.S. economy grew at a 2.1% rate in the first-quarter of 2026. Taken together with the final second-quarter reading, it suggests the U.S. economy grew at a rate of about 2.15% in the first half of this year.<\/p>\n FED’S FAVORED INFLATION GAUGE COOLED IN AUGUST BUT REMAINED ELEVATED<\/a><\/p>\n Last year, the U.S. economy grew at an annualized rate of 4.4% in the third quarter and 0.5% in the fourth quarter, which contributed to a growth rate of about 2.1% for 2025 as a whole.<\/p>\n The BEA reported that the main categories that contributed to the rise in real GDP in the second quarter were increases in consumer spending<\/a>, investment and exports. Imports also increased.<\/p>\n The leading contributors to the rise in investment were nonresidential structures, which were primarily from investment in data centers<\/a> as well as broader construction in the commercial and healthcare sectors.<\/p>\n Increases in consumer spending from the BEA’s revisions were driven by recreation services, as well as recreational goods and vehicles.<\/p>\n Imports increased in the second quarter. (David McNew\/Getty Images)<\/p>\n PRIVATE SECTOR ADDED 90,000 JOBS IN SEPTEMBER, ABOVE EXPECTATIONS, ADP SAYS<\/a><\/p>\n Leading industry contributors to the increase in GDP were real estate and rental leasing, information, durable goods manufacturing, and finance and insurance. The leading offsets were decreases in transportation and warehousing, retail trade, and nondurable goods manufacturing<\/a>.<\/p>\n Real final sales to private domestic purchasers, which is the sum of consumer spending and gross private fixed investment, increased 4.6% in the second quarter after being revised up 0.4 percentage points from the previous estimate.<\/p>\n What experts are saying<\/p>\n EY-Parthenon chief economist Gregory Daco said that the firm now expects GDP will grow close to 2.5% in 2026 which he said would be “a solid figure considering the range of supply-side headwinds from trade policy, geopolitical stress and higher energy costs, demographic pressures, and immigration constraints.”<\/p>\n “Still, one cannot overlook that growth could have been stronger \u2013 potentially with a 3% handle \u2013 and inflation lower \u2013 closer to the Fed’s 2% target \u2013 in the absence of those shocks,” he explained.<\/p>\n WHY THE FED ISN’T READY TO DECLARE VICTORY ON INFLATION<\/a><\/p>\n Bret Kenwell, etoro U.S. investment analyst, said that “GDP expectations had already been reduced earlier this quarter, so today’s upwardly revised reading is an improvement, though it largely brings growth back in line with where expectations started.”<\/p>\n “The economy is holding up, but momentum remains modest. While the data is backward-looking, the more important takeaway may be that personal consumption came in ahead of expectations, reinforcing the case for a resilient consumer even as inflation continues to outpace wage growth,” Kenwell added.<\/p>\n Fed Chair Kevin Warsh and central bank policymakers will meet in October for their next monetary policy meeting. (David Paul Morris\/Bloomberg via Getty Images)<\/p>\n What does it mean for the Fed and interest rates?<\/p>\n![\"San](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2026\/09\/san-pedro-california-port.jpg\")
<\/p>\n![\"Federal](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2026\/09\/fed-chair-kevin-warsh-jackson-hole-2026-003.jpg\")
<\/p>\n