Exports help US economy speed up
Print Edition
The US economy accelerated more quickly than expected in the second quarter thanks to a surge in exports, bolstering the case for the Federal Reserve to wind down a major economic stimulus program.
Other economic data yesterday showed the number of Americans filing new claims for jobless benefits fell last week, a potential sign of faster hiring in August.
US gross domestic product grew at a 2.5 percent annual rate in the April-June period, according to revised estimates released by the Commerce Department. That was more than double the pace clocked in the prior three months.
The reports could boost confidence the economy is turning a corner despite government austerity measures and a still-high jobless rate.
The government had initially estimated that GDP grew 1.7 percent in the second quarter. But recent data on trade showed exports climbed during the period at their fastest pace in more than two years.
The government also said data from retailers showed that businesses had restocked their shelves at a faster pace in the April-June period than initially estimated.
Economists polled by Reuters had forecast the economy growing at a 2.2 percent pace.
Many economists expect the economy will accelerate further in the second half of the year as austerity measures begin to weigh less on national output.
That drag was evident in the second quarter, when spending contracted at all levels of government. Indeed, yesterday’s data showed the economic drag from spending cuts was greater in the second quarter than initially estimated.
Still, the data could make officials at the Fed more confident in their plan to begin reducing monthly bond purchases later this year.
“The market will take (the data as a sign that) tapering would be more likely next month,” said Scott Brown, an economist at Raymond James in St Petersburg, Florida.
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