President Trump Touts ‘Great Numbers’ In GDP Report

US economy grows 4.1% in 2nd quarter

US economy grows 4.1% in 2nd quarter

The U.S. economy grew more than 4 percent in the second quarter - the largest quarterly jump in four years, according to the Commerce Department. Soybean exports - a target of retaliatory tariffs from China and the European Union - shot up, likely in an effort to skirt the incoming tariffs.

Their policies would mean not just a return to President Obama's economic policies. If Trump's trade wars continue or intensify, growth will suffer more.

The Commerce Department reported Friday that the gross domestic product, the country's total output of goods and services, posted its best showing since a 4.9 percent gain in the third quarter of 2014.

If the economy grows at 3% or more in 2018, it will be the highest annual rate since 2005.

In July, the USA and China imposed tariffs on $34bn of the other country's goods.

The latest economic data signal business investment remains firm even as President Trump widens a global trade tariffs beyond steel and aluminum and into a growing range of products from China.

This morning it was reported that the U.S. economy grew in the second quarter at a pace of 4.1%, falling just short of the 4.2% rate economists at Bloomberg had predicted. Unemployment among Blacks, Hispanics and women is now at record lows.

But Trump, ever the salesman, predicted even higher growth as he renegotiates the nation's trade deals, saying, "We're going to go a lot higher than these numbers".

He pointed to new tax cuts, de-regulation, increased government spending and the continuing trade negotiations. "We've accomplished an economic turnaround of historic proportions".

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Compared with the second quarter of 2017, the economy grew by 2.8% in the April-June period. He said the economy is on track to reach an annual growth rate of more than 3 percent.

Researchers at Capital Economics said that the acceleration in GDP growth, especially the increase in consumer spending, "is principally due to the massive fiscal stimulus unleashed at the start of this year".

PNC Bank is forecasting growth of 3.1% in 2018 - assuming that trade tensions dissipate.

Economists surveyed by The Wall Street Journal expected a 4.4 per cent growth rate. That was almost double the first quarter rate of 2.2 percent and the strongest pace in almost four years.

There were some signs of softness, however. They noted that business fixed investment slowed to 5.4 percent from 8 percent in the first quarter.

That weakness is a potential red flag, said Lindsey Piegza, chief economist at Stifel. At its core, it says that consumer demand is taking a massive hit.

But the widespread expectation is that growth will be significantly lower in the third and fourth quarters, probably falling short of Trump's 3 percent goal for the year. Personal consumption increased by 4% in the first full quarter after President Donald Trump's new tax law went into effect.

Beyond that, while the Trump administration insists this isn't just a short-term sugar rush, many economists still expect growth to slow significantly by 2020. We have to give the president credit here. When Republicans passed their multitrillion-dollar corporate-tax cut last winter, they insisted that the legislation would stimulate capital investment, and thus innovation, and thus growth.

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