The U.S. economy may have eked out modest growth in the second quarter, skirting back-to-back quarterly contractions, but rising at a tepid enough pace to feed concerns of an eventual downturn.
Economists expect gross domestic product grew an annualized 0.4% in the April-June period, which on the surface would be an improvement after the 1.6% drop in the first quarter. However, the breakdown of second-quarter GDP may illustrate a more concerning softening of demand.
The first-quarter decline largely stemmed from a surge in imports and a more moderate pace of consumption. While a narrowing of the trade deficit in the second quarter likely added to GDP, consumer spending probably decelerated further.
