The US economy expanded at an annualized rate of just 1.5% in the second quarter of 2026, falling significantly short of consensus expectations for gross domestic product growth.
The Commerce Department’s report highlights a marked slowdown in economic momentum, signaling that the drag from higher borrowing costs and softer consumer demand is taking hold.
5% in June, a reading that surprised markets by coming in lower than the consensus forecast.
This reading represents a notable deceleration from previous quarters, underscoring the fragility of the current expansion.
The weak growth print arrives as consumer price inflation remains stubbornly above the Federal Reserve’s 2% target.
US consumer price inflation decelerated to 3.5% in June, a reading that surprised markets by coming in lower than the consensus forecast.
Despite this cooling trend, the persistent gap between actual inflation and the central bank’s goal limits the scope for aggressive monetary easing.