U.S. economy in Q2 revised up to annualized 6.6 pct

WASHINGTON, Aug. 26 (Xinhua) -- The U.S. economy grew at an annual rate of 6.6 percent in the second quarter in second estimate, up from the 6.5 percent in advance estimate, the U.S. Commerce Department reported Thursday.

The update reflects upward revisions to nonresidential fixed investment and exports that were partly offset by downward revisions to private inventory investment, residential fixed investment, and state and local government spending, according to the report.

Imports, which are a subtraction in the calculation of gross domestic product (GDP), were revised down.

Despite the upward revision, the 6.6-percent gain is still considerably less than consensus estimate.

In the first quarter, real GDP increased by 6.3 percent. In 2020, the U.S. economy contracted 3.4 percent amid the pandemic.

"In the second quarter, government assistance payments in the form of loans to businesses and grants to state and local governments increased, while social benefits to households, such as the direct economic impact payments, declined," the report said.

The increase in real GDP in the second quarter reflected increases in personal consumption expenditures (PCE), nonresidential fixed investment, exports, and state and local government spending, which were partly offset by decreases in private inventory investment, residential fixed investment, and federal government spending, the report showed. Imports, which are a subtraction in the calculation of GDP, increased.

The latest GDP data was released on the same day as the Labor Department reported that initial jobless claims ticked up to 353,000 last week amid a Delta variant-fueled COVID-19 surge, after falling for four straight weeks, indicating a bumpy economic recovery.

The U.S. Federal Reserve has pledged to keep its benchmark interest rate unchanged at the record-low level of near zero, while continuing its asset purchase program at least at the current pace of 120 billion U.S. dollars per month until "substantial further progress" has been made on employment and inflation.

Fed Chair Jerome Powell is set to speak on Friday during the Federal Reserve Bank of Kansas City's annual Jackson Hole economic symposium, which may offer further clues on the central bank's plan to start tapering its asset purchases.