U.S. economy slowed to 1.5% growth rate in Q2; June core inflation at 3.3%

📰 source: cnbc_topnews · 💼 business

the us economy grew at a 1.5% annualized rate in the second quarter, missing the 1.8% expected by economists. core pce inflation — the fed's preferred gauge — came in at 3.3% year-over-year in june, still well above the central bank's 2% goal.

personal spending rose 2.1%, a solid gain, but the savings rate fell to 2.7%, the lowest in four years. the fed voted 9-3 to hold rates between 3.5% and 3.75%, with three regional presidents dissenting over inflation concerns. the gdp miss was partly due to a decline in federal spending and inventories, while final sales to private domestic purchasers — a measure of underlying demand — grew 3.9%.

energy prices fell 5.9% in june as gasoline dropped 9.2%, helping to moderate inflation for the month. but on a quarterly basis, the pce index surged 5.1% headline and 3.4% core. stock futures were positive after the data, while treasury yields rose.

why it matters: gdp growth slowed to 1.5% while core inflation at 3.3% keeps fed on hold, pressuring rate-sensitive sectors.

source: cnbc_topnews
sentiment: -0.50 · impact: 0.90