Friday, July 31, 2026 from Floor Daily

Real gross domestic product (GDP) increased at an annual rate of 1.5% in Q2 2026 (April, May, and June), according to the advance estimate released by the U.S. Bureau of Economic Analysis (BEA).

In Q1, real GDP increased 2.1%.

The contributors to the increase in real GDP in Q2 were increases in consumer spending, investment, and exports that were partly offset by a decrease in government spending. Imports, which are a subtraction in the calculation of GDP, increased.

Compared to Q1, the deceleration in real GDP in the second quarter reflected a downturn in government spending and decelerations in investment and exports that were partly offset by an acceleration in consumer spending. Imports increased more in the second quarter than in the first quarter.

According to Morning Brew, “The US economy is growing at a slower pace, but it’s not letting anything knock it down. GDP growth sank to 1.5% last quarter, the government estimated yesterday, down from 2.1% in the previous quarter and below the 1.8% that economists expected.

“But, after stripping out volatile government spending and trade numbers, the US economy still grew a relatively healthy 3.9% despite jitters from the Iran war—largely because Americans kept shopping:

• Growth in consumer spending, aka the mighty fuel of the US economy, accelerated to 3.2%, from 0.5% in Q1.
• Analysts say that household budgets were aided by bigger-than-usual tax refunds this spring and gas price declines in June stemming from a ceasefire in the Iran war, which has since unraveled.

“A separate government report showed that cheaper gas contributed to overall consumer prices falling in June by 0.1% for the first time in six years, though the annual inflation number of 3.7% was still above the Fed’s goal of 2%. Analysts warn that Americans’ purchasing power might run out of steam this quarter as resumed fighting in Iran reignites inflation.”