The US economy expanded at a mere 1.5% annualized rate in Q2 2026, according to the Bureau of Economic Analysis advance estimate released on July 30. This represents a significant slowdown from Q1’s 2.1% growth and falls short of economist forecasts, which had also projected 2.1%. Declining investment, reduced government spending, and a sharp increase in imports dragged down growth, while rising energy prices eroded consumer purchasing power and business margins. The situation presents the Federal Reserve with a dilemma between supporting a slowing economy or combating persistent inflation.
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