US Economy Slows to 1.5% Growth as Inflation Persists Above Target

The US economy's growth slowed down in the second quarter of this year, expanding at an annual rate of 1.5% between April and June.

This was mainly due to a surge in imports, which rose by 11.5%, partly driven by increased shipments of computer chips and other products supporting artificial intelligence investments.

However, consumer spending remained resilient, growing at a 3.2% annual pace, up from the 0.5% recorded in the first quarter.

The Federal Reserve's preferred inflation gauge, the personal consumption expenditures (PCE) price index, rose by 3.7% last month, above its target of 2%, and has now been above this target for over five years.

Despite the higher costs, the job market has shown signs of recovery, with an average of 92,000 jobs added per month so far this year, compared to fewer than 10,000 in 2025.