In the second quarter of this year, the U.S. economy showed a growth of 3%. This is a result contrary to the expectation that tariffs would burden the economy.
On the 30th, the U.S. Department of Commerce announced that the domestic gross domestic product (GDP) growth rate for the second quarter was 3.0% (annualized compared to the previous quarter). This is higher than the expert forecasts compiled by Dow Jones, Bloomberg, and Reuters (2.3% to 2.6%). In the first quarter, imports temporarily expanded due to the impact of tariffs, resulting in a contraction of -0.5%, but the economy has returned to growth after just one quarter.
The market analyzes that the sharp decline in temporarily expanded imports has led to the rebound in growth rates. In GDP statistics, an increase in imports lowers the growth rate, while an increase in exports raises it. Moreover, in June, the U.S. trade deficit recorded $86 billion, the lowest level in the past two years. The Financial Times (FT) noted, "The imposition of tariffs on some imported goods has led to a decrease in imports by U.S. corporations, affecting the growth rate."
The U.S. Department of Commerce reported that core personal consumption expenditures (PCE) prices in the second quarter rose by 2.5% compared to the previous year. This is higher than the estimated rate of 2.3%, but lower than the first quarter's rate of 3.5%. This indicator is used by the Federal Reserve, the central bank of the United States, to make decisions on interest rates.
President Donald Trump called on Jerome Powell, the chair of the Federal Reserve, on social media (SNS) to "lower rates now" as soon as the GDP growth rate was announced. The Federal Reserve will announce the results of the Federal Open Market Committee (FOMC) meeting where it decides the benchmark interest rate at 2 p.m. local time. The Federal Reserve has kept the benchmark interest rate unchanged in four FOMC sessions, and President Trump has pressured Chairman Powell, even mentioning a resignation.