US Economy Slows to 1.5% Growth in Second Quarter Amid Inflation Concerns

The US economy has slowed down to a growth rate of 1.5% in the second quarter, falling short of expectations and marking a decline from the first quarter's 2.1% growth.

The deceleration was driven by lower government spending, investments, and exports, while consumer spending was the main driver of growth, with a 4% increase in final sales.

The Federal Reserve's preferred measure of inflation, the Personal Consumption Expenditures Price Index (PCE), rose to 3.7% over 12 months, with core PCE coming in at 3.3%, still above the Fed's 2% target.

Federal Reserve Chairman Kevin Warsh has signaled that he is not in a rush to cut interest rates, stating that five years of inflation above target cannot be cured in nine weeks or by a single month of modest price decreases.