U.S. Economy Grows at 5.6 Pct. Rate
WASHINGTON (AP) _ The U.S. economy roared ahead in the spring, growing at a 5.6 percent annual rate, stronger than the government previously thought. Solid investment by American businesses offset less brisk spending by consumers.
The Commerce Department reported Thursday that in the April-June quarter the increase in the gross domestic product surpassed growth in the first quarter, when the economy expanded at a 4.8 percent annual rate. GDP is the nation’s total output of goods and services and the broadest measure of economic health.
The government’s final reading on GDP _ based on more data than its previous calculations _ showed the economy growing more quickly than the 5.3 percent rate it estimated one month ago and the 5.2 percent rate initially calculated. The 5.6 percent rate marked the best showing since the fourth quarter of last year.
The second-quarter performance also was stronger than many analysts expected. They anticipated that growth would hold steady at 5.3 percent. In the current quarter, many analysts believe the economy has slowed to a growth rate in the 3 percent range.
Even with the robust growth in the second quarter, inflation pressures actually moderated. An inflation gauge tied to the GDP, and closely watched by Fed Chairman Alan Greenspan, rose at a revised annual rate of 2.1 percent in the second quarter, better than the previous estimate and down from a 3.5 percent rate in the first quarter.