US Economy expands 2.2% amid persistent inflation

WASHINGTON The US economy grew at an annual rate of 2.2 per cent in the second quarter of 2026, with consumer spending, investment and exports driving expansion, while inflation remained elevated, according to the latest data from the US Bureau of Economic Analysis. Real GDP growth for April-June was revised upward by 0.7 percentage point from the previous estimate, reflecting stronger readings for investment, consumer spending and government spending. GDP had grown 2.5 per cent in the first quarter, also revised from the earlier estimate. Real final sales to private domestic purchasers, covering consumer spending and gross private fixed investment, rose 4.6 per cent during the second quarter. Real gross domestic income increased 2.6 per cent, while the average of real GDP and real GDI rose 2.4 per cent. Price pressures remained significant. The price index for gross domestic purchases increased 5.6 per cent, while the personal consumption expenditures price index rose 5.0 per cent. The PCE index excluding food and energy increased 3.3 per cent. Real value added in private services-producing industries rose 2.5 per cent, while private goods-producing industries increased 2.3 per cent. Government real value added grew by less than 0.1 per cent. Real gross output increased 5.0 per cent, led by a 6.0 per cent rise in private services-producing industries. Real estate and information, durable goods manufacturing, and finance and insurance were leading industry contributors. These gains were partly offset by declines in transportation and warehousing, retail trade, and nondurable goods manufacturing. Private goods-producing industries recorded a 3.0 per cent increase in gross output, while government output rose 2.6 per cent.