Growth of US economy revised up as consumer spending surges

THE US government yesterday revised up its second-quarter GDP growth by 0.1 per cent to 1.7 per cent.

Personal consumption was revised up from an original estimate of two per cent growth to 2.2 per cent, the biggest quarterly leap in consumer spending in three years. This compared with a 2.1 per cent rise in purchases in the first quarter. Businesses built up their inventories, adding $68.8bn (£44bn) to their value, rather than $63.2bn as first thought. Inventories grew by $44.1bn in the first quarter.

The tenth of a percentage point increase in GDP for the three months to 30 June added $3.4bn to the US economy. But economists warned that import numbers suggested that recovery from recession would remain slow.

GDP was still far below the first quarter’s 3.7 per cent growth rate.