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US economic growth up by 3.1% in Q2
Washington, Aug 29: The US economy revved up at a 3.1 per cent growth pace in the second quarter, the government has said, in another sign that the world`s largest economy is gathering momentum.
Washington, Aug 29: The US economy revved up at a 3.1 per cent growth pace in the second quarter, the government has said, in another sign that the world`s largest economy is gathering momentum.
The rise in gross domestic product, revised upward from an earlier estimate of 2.4 per cent, the strongest since the second quarter of 2002, surprised economists, who had
forecast a revision to about 2.9 per cent growth.
A big factor was a 45.9 per cent surge in defence spending, the strongest since the Korean war, as the government ramped up spending for the war in Iraq. The strong acceleration from the 1.4 per cent growth rate in the first quarter suggests the world`s largest economy is gathering momentum and will show even stronger growth in the second half, said analysts. "It`s really excellent. It`s a great platform for the building momentum of the next four quarters," said David Littmann yesterday, chief economist at Comerica Bank. He said the rise is likely to continue in the coming quarters as a result of massive tax cuts and low interest rates.
BMO economist Sal Guatieri said the figures along with other recent data point to growth of at least 4.5 per cent in the July-September quarters. "Upward revision in business investment is very encouraging," he said.
"It suggests that businesses are now taking part in the economic recovery ... They are becoming increasingly confident in the economic outlook."
Bureau Report
A big factor was a 45.9 per cent surge in defence spending, the strongest since the Korean war, as the government ramped up spending for the war in Iraq. The strong acceleration from the 1.4 per cent growth rate in the first quarter suggests the world`s largest economy is gathering momentum and will show even stronger growth in the second half, said analysts. "It`s really excellent. It`s a great platform for the building momentum of the next four quarters," said David Littmann yesterday, chief economist at Comerica Bank. He said the rise is likely to continue in the coming quarters as a result of massive tax cuts and low interest rates.
BMO economist Sal Guatieri said the figures along with other recent data point to growth of at least 4.5 per cent in the July-September quarters. "Upward revision in business investment is very encouraging," he said.
"It suggests that businesses are now taking part in the economic recovery ... They are becoming increasingly confident in the economic outlook."
Bureau Report