Overview
- The Bureau of Economic Analysis’ second estimate left real GDP growth unchanged at 0.4% quarter‑over‑quarter, or 1.5% annualized, for the second quarter of 2026.
- The BEA revised personal consumption expenditures inflation up to a 5.3% annualized pace and core PCE to 3.6%, raising the inflation signal the Federal Reserve watches closely.
- Consumer spending remained strong with personal consumption rising at a 3.4% annualized rate, but a 12.5% surge in imports subtracted about 1.64 percentage points from measured GDP.
- Business investment measures paint a split picture: nonresidential investment excluding housing rose sharply, driven in part by AI‑related spending, while an alternate BEA investment series was revised down to a 2.7% decline.
- The mixed data — slower headline growth but stronger PCE inflation and uneven investment — increases uncertainty about the Fed’s next move and leaves markets pricing a likely rate hold in September.