GDP grows 1.2% in Q2 as inventories fall

Washington

THE US economy grew far less than expected in the second quarter as inventories fell for the first time since 2011, but a surge in consumer spending pointed to underlying strength.

Gross domestic product (GDP) increased at a 1.2 per cent annual rate after rising by a downwardly revised 0.8 per cent pace in the first quarter, the Commerce Department said on Friday. The economy was previously reported to have grown at a 1.1 per cent pace in the first quarter.