Pessimist and doubters of global growth will feel sigh of relief today as US economy turned out to be stronger than everyone is expecting.
- Preliminary reading shows that US economy grew 2.1% in the second quarter, beating both analysts' expectation and prior rate of 2%. GDP grew at annual rate of 3.7%.
- Moreover growth was broad based. The increase in real GDP in the second quarter reflected positive contributions from personal consumption expenditures (PCE), exports, state and local government spending, nonresidential fixed investment, residential fixed investment, and private inventory investment.
- Imports however, remains drag on the economy.
US growth will be beneficial for global economy, at a time when Chinese economy is slowing down.
Encouraging is, in spite of low energy price and economic slowdown at the beginning of second quarter, Personal consumption Expenditure prices remains steady.
- Preliminary reading showed, that PCE prices for core remained at same 1.8% level, while growth was 2.2% overall.
Dollar has gained after the release. Dollar index is currently trading at 95.44, up 0.17% for the day.
