U.S. Economic Recovery... Surprise Growth of 3.0% in Q2 GDP

JOON HYOUNG LEE

Summary

The U.S. Department of Commerce stated that the quarterly GDP growth rate for the second quarter was 3.0%.
This number is reported to significantly exceed both the potential growth rate and expert forecasts.
It was explained that the main reason for the recovery in growth rate is a decrease in imports due to a reduction in temporary inventory accumulation factors.

The U.S. economy, which experienced negative growth in the first quarter of this year, regained its growth momentum in the second quarter.

The U.S. Department of Commerce announced on the 30th (local time) that the advance estimate for the country's gross domestic product (GDP) growth rate in Q2 was recorded at 3.0% (quarter-on-quarter annualized rate). This figure is significantly above the potential growth rate, which is estimated to be in the low 2% range, and also far exceeds the expert forecast compiled by Dow Jones (2.3%).

Previously, U.S. GDP posted a negative growth rate of 0.5% in Q1 due to a temporary increase in imports ahead of tariff imposition. The reduction in this temporary inventory build-up factor, leading to a decrease in imports, is cited as the main reason for the GDP growth rate recovery in Q2.

Meanwhile, unlike South Korea, the United States announces GDP statistics by converting the quarter-on-quarter growth rate into an annualized rate.

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