US GDP growth revised up in Q2

[WASHINGTON] US economic growth was stronger than estimated in the second quarter of the year, government data showed on Thursday (Aug 28), but this came in a period where President Donald Trump’s fresh tariffs distorted trade flows.

Gross domestic product rose at an annual rate of 3.3 per cent in the April to June period, revised upwards from 3.0 per cent announced in July, according to the Department of Commerce.

The upward revision mainly reflected improvements in investment and consumer spending, the report said.

But overall, GDP growth in the second quarter was also bolstered by a fall in US imports, which are subtracted from the GDP.

This drop came as businesses pulled back on shipments after rushing to stock up ahead of Trump’s tariff hikes.

The uptick in GDP growth in the world’s biggest economy reversed a decline in the first three months of the year, prompting Trump to ramp up pressure for an interest rate cut by the central bank.

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Since his return to the presidency in January, Trump has rolled out multiple waves of fresh duties.

These included a 10-per cent levy on almost all US partners, with steeper rates for dozens of economies.

He also imposed separate duties on steel, aluminium and auto imports, alongside actions specifically targeting Canada and Mexico, blaming them for illegal immigration and illicit fentanyl flows.

Washington took aim as well at the world’s number two economy, China, as Beijing pushed back on US tariffs. AFP