The U.S. economy grew at a sluggish 1.5% pace in the second quarter of 2026, down from 2.1% in the first quarter and below economists’ expectations, according to the Commerce Department. The Fed’s preferred inflation gauge, the PCE price index, rose 3.7% in June from a year earlier, down from 4.1% in May but still above the central bank’s 2% target, prompting the Fed to hold interest rates for the fifth consecutive meeting. The job market has bounced back with employers adding an average of 92,000 jobs per month this year, compared to fewer than 10,000 per month in 2025, giving consumers the means to spend.
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