The U.S. economy grew at an annual rate of 3.4 percent in the second quarter, the fastest pace in more than a year, the Commerce Department reported Friday.
The reading for gross domestic product (GDP) -- the output of goods and services produced by labor and property located in the United States -- marked a big improvement from the first three months of this year, when the economy increased by only 0.6 percent, the weakest showing in more than 4 years.
Stronger business spending was a main force behind the acceleration in GDP growth during the April-to-June period, according to the department.
For the second quarter, business investment rose by 3.1 percent, rebounding from an 8.2 percent plunge in the previous quarter.
Business investment on equipment and software increased by 2.3 percent, much stronger than the 0.3 percent gain in the first quarter.
Investment in home building declined by 9.3 percent, compared to a 16.3 percent drop in the first quarter, marking the smallest cut in just over a year.
Personal consumption expenditures, however, climbed by only 1.3 percent in the second quarter, after a 3.7 percent advance in the first quarter.
Analysts said that consumers tightened their belts in the second quarter as they coped with high gasoline prices and the ill effects of the housing slump.
"Core" prices, an inflation gauge closely watched by the Federal Reserve, rose at a 1.4 percent rate in the second quarter. That was down from the 2.4 percent pace in the first quarter and was the smallest gain in four years.
GDP is considered the best barometer of the country's economic fitness. Core prices exclude volatile energy and food.
Source: Xinhua
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