The U.S. economy expanded at a sluggish 1.5% pace from April through June as rising imports weighed on growth, according to a report by the Associated Press.
The Commerce Department reported Thursday that growth in U.S. gross domestic product declined from the 2.1% recorded in the first three months of 2026, coming in below economists’ expectations.
Thursday’s GDP report was the first of three Commerce Department estimates of second-quarter economic growth.
Commerce also said that its personal consumption expenditures price index rose 3.7% last month from June 2025, down from a 4.1% year-over-year increase reported in May.
The Federal Reserve’s favored measure of inflation grew more slowly last month but remained above the central bank’s 2% target.
Excluding the more volatile food and energy prices, the so-called core consumer prices were up 3.3% from a year earlier, compared to a 3.4% increase in May.
The Fed on Wednesday chose to leave its benchmark interest rate unchanged for the fifth straight meeting.
Three regional Fed presidents dissented, saying the rate should be increased to fight inflation.
