Economy grew more than estimated during the second quarter

The U.S. economy expanded more during the second quarter than previously estimated, according to The Washington Post.

The economy expanded at a 2.5 percent annual rate from April through June, which is significantly higher than the government's initial estimate of 1.7 percent and more than double the 1.1 percent rate reported during the first quarter. The revision mainly can be attributed to U.S. companies exporting more goods and imports declining.

Government spending was weaker during the second quarter, shrinking at a 0.9 percent annual rate. Housing and business investment remained strong; housing construction grew at an annual rate of 12.9 percent and business investment on structures was revised up to a 16.1 percent rate, although spending on equipment was revised a bit lower. Additionally, consumer spending, which accounts for 70 percent of economic activity, grew by a 1.8 percent rate during the second quarter.

Economists expect growth to remain at an annual rate of around 2.5 percent during the second half of the year, helped by steady job gains and fewer federal spending cuts. However, some economists believe higher interest rates might restrain the economy's expansion during the second half.

Date : 8/29/2013