US Economy Slows Down in Q2 Despite Strong Consumer Spending

The US economy has shown signs of slowing down in the second quarter, according to new data released by the Commerce Department. The advanced reading of gross domestic product came in at 1.5%, falling short of expectations and marking a drop from the first quarter's 2.1% growth. This deceleration was driven by lower government spending, investments, and exports.

The bulk of the growth that did occur came from consumer spending. White House Economic Council Director Kevin Hassett said 'the fact is that final sales were up almost 4%. We had a big boom in consumption, a big boom in investment.'

The Federal Reserve's preferred measure of inflation, the Personal Consumption Expenditures Price Index, rose to 3.7% over 12 months. Core PCE, which excludes volatile food and energy prices, came in at 3.3%, still above the Fed's 2% target.