US economy expands at sluggish 1.5% pace in second quarter, but consumer spending stayed strong
Aug 26, 2026, 5:40 AM
An employee checks a customer's identification card before checking out alcohol at a cash register in a grocery store in Arlington Heights, Ill., Monday, July 6, 2026. (AP Photo/Nam Y. Huh)
Credit: AP Photo/Nam Y. Huh
(AP Photo/Nam Y. Huh)
WASHINGTON (AP) — The U.S. economy grew at a sluggish 1.5% pace from April through June. But consumer spending stayed strong.
The Commerce Department reported Wednesday that growth in gross domestic product — the nation’s output of a goods and services — decelerated from a 2.1% pace from January through March. The second-quarter growth number was unchanged from the department’s first estimate.
Still, consumer spending — which accounts for about 70% of U.S. economic activity — increased at a healthy 3.4% annual clip, up from 0.5% in the January-March period.
The reason for the lackluster growth number was imports. They are subtracted from growth because GDP is only supposed to count domestic U.S. production. Imports rose at a 12.5% annual pace from April through June, partly due to a surge in shipments of computer chips and other products that support artificial intelligence investment, and sliced 1.64 percentage points off second-quarter growth.
But business investment was up, reflecting the AI boom.
The U.S. economy has proven surprisingly resilient in the face of fighting with Iran and the spike in energy prices it caused.
Wednesday’s report was the second of three Commerce Department looks at second-quarter GDP growth. The third and final report is due Sept. 30.
