Economic growth accelerated during the second quarter of 2023, rising 2.4% after rising 2% during the first quarter of 2023, according to CNBC. Economists had been expecting growth of 2%.
The acceleration in growth is attributed to strong consumer spending and increases in nonresidential fixed investment, government spending and inventory growth.
“It’s great to have another quarter of positive GDP growth in tandem with a consistently slowing inflation rate,” said Steve Rick, chief economist at TruStage. “After yesterday’s resumption of interest rate hikes, it’s encouraging to see the aggressive hike cycle working as inflation continues to decline. Consumers are getting a reprieve from the rising costs of core goods, and the U.S. economy is off to a stronger start to the first half of the year.”
Consumer spending as measured by personal consumption expenditures increased 1.6% and accounted for 68% of all economic activity during the quarter.
Government spending increased 2.6%, including a 2.5% boost in defense expenditures and 3.6% rise at the state and local levels.
Additionally, gross private domestic investment increased by 5.7% after falling 11.9% during the first quarter; a 10.8% surge in equipment and 9.7% boost in structures helped drive that growth.
