US economy’s growth was weaker than expected in the second quarter | CNN Business

The world’s largest economy lost steam heading into summer as red-hot demand for AI infrastructure widened the trade deficit, dampening growth. Meanwhile, Americans ramped up their spending in the quarter, a welcome sign for an economy that relies so strongly on consumption for growth. US gross domestic product, which captures all the goods and services produced in the economy, expanded at an annualized rate of 1.5% from April through June. That was well below the 2.1% rate in the prior quarter and lower than the 2.1% economists predicted in a poll by data firm FactSet. GDP is adjusted for seasonal swings and inflation. The trade deficit grew 42.2% to a seasonally adjusted $77.6 billion in May, according to Commerce Department data. It was the highest level in nearly a year, as imports of computer accessories, semiconductors and other AI-related products far outstripped exports. The trade gap shrank slightly in June. But consumer spending, the lifeblood of the US economy, picked up sharply in the second quarter to an annualized 3.2% rate, up from the first quarter’s 0.5%. It was the fastest pace in nearly a year, and was the largest contributor to GDP for the three-month period