The revised data published by the United States Department of Commerce show that the United States gross domestic product (GDP) grew by 1.5 per cent annually in the second quarter, which is below the previous opening value of 2.1 per cent in the first quarter. Despite the overall slowdown, consumption spending remained strong, indicating that the United States economy had not yet lost significant momentum under high inflation and external shocks.
Consumption expenditure continues to support growth
In terms of structure, household consumption remains the main support for this season ' s growth. The annual growth in consumption expenditure in the second quarter was 3.4 per cent, significantly higher than 0.5 per cent in the first quarter. Consumption accounts for about 70 per cent of United States economic activity, a figure that means that domestic demand continues to support economic expansion.
Department of Commerce data also show that after the elimination of more volatile projects such as government expenditure and trade, an indicator reflecting endogenous needs grew by 4.2 per cent in the second quarter, up from 1.7 per cent in the first quarter. Business investment is also strong, with business investment without housing growing annually by 8.5 per cent.
AI-related imports lower overall growth
The main factor delaying overall growth in the second quarter was imports. Since GDP statistics account for only domestic production, the increase in imports will be reduced in accounting. Between April and June, United States imports grew by 12.5 per cent on an annual basis, directly reducing GDP growth by 1.64 percentage points in the second quarter.
Increased imports of products related to AI infrastructure development, such as chips, were mentioned as one of the important reasons for higher imports. As businesses continue to invest in computing and equipment, the demand for related commodities rises and, to some extent, changes the growth structure of the season.
Housing investment also rebounded in the second quarter, the first increase since the end of 2024. However, high mortgage rates continue to suppress the real estate market in the United States, and rehabilitation efforts in the residential sector are still limited.
High inflation coexists with tariff expectations
In terms of inflation, the Ministry of Commerce report indicates that the July price increase was 3.7 per cent, the same as June, but still significantly above the Federal Reserve target of 2 per cent. Reports indicate that since the United States and Israel hit Iran at the end of February, energy prices have risen and inflationary pressures have increased.
At present, high oil prices resulting from the Iranian conflict, the threat posed by Trump to impose new tariffs on Canada and China, and AI’s infrastructure spending on computers, game hosts, and semiconductors continue to collectively influence US price trends.
Additional information:The Department of Commerce published three estimates of GDP for the second quarter, this time for the second revision of the data, which will be released on 30 September.