US GDP Growth Slows to 1.5 Percent in Second Quarter

The U.S. Department of Commerce reported that the U.S. economy grew at an annualized rate of 1.5 percent in the second quarter of 2026. This represents a deceleration from the 2.1 percent growth recorded in the first quarter and fell short of analyst expectations.

Government spending, investment, and exports declined, while a surge in imports—specifically artificial intelligence computer chips—reduced GDP growth by 1.5 percentage points. Consumer spending remained a primary economic driver, growing at 3.2 percent. These figures emerge as a conflict with Iran has pushed Brent crude prices to approximately $90 a barrel.

In response to ongoing economic conditions, the Federal Reserve held interest rates unchanged for a fifth consecutive meeting. The decision faced dissent from three regional presidents, as inflation remains above the 2 percent target. Federal Reserve Chairman Kevin Warsh noted that no "magic wand" exists to resolve the issue of rising prices.