Households kept spending even as confidence weakened, while companies continued investing in equipment and AI infrastructure. A revised report reshapes the picture.
The U.S. economy grew faster in the second quarter of 2026 than an earlier estimate showed. The revision reflected stronger consumer spending and business investment, particularly in the development of artificial intelligence infrastructure.
As mentioned by Reuters
U.S. gross domestic product rose at an annualized rate of 2.2%, rather than the previously estimated 1.5%. The revised figure was released in the third estimate of quarterly GDP. Analysts surveyed had expected the estimate to remain unchanged.
Consumer spending supported economic growth
The economy grew at an annualized rate of 2.5% in the first quarter. That figure was also revised upward, from an earlier estimate of 2.1%.
Consumer spending, which accounts for more than two-thirds of U.S. economic activity, rose 3.8% in April-June. The previous estimate was 3.4%. By comparison, growth was much slower in the first quarter, at 0.7%.
At the same time, household budgets are coming under increasing pressure from inflation, particularly rising gasoline prices. In September, the Conference Board’s consumer confidence index fell to nearly its lowest level in 12.5 years.
Despite concerns about inflation, consumer spending likely remained high in the third quarter. It may have been boosted by a rising stock market amid interest in artificial intelligence, the use of savings, and a lower saving rate. Business investment in equipment maintained double-digit growth.
Other indicators were also revised
Final sales to private domestic purchasers, which exclude trade, inventories, and government spending, rose 4.6% in the second quarter. The previous estimate was 4.2%. In January-March, this measure increased 1.8%, rather than the previously reported 1.7%.
Based on income calculations, the economy grew at an annualized rate of 2.6%. The initial estimate was 2.2%; the revision reflected stronger corporate profits. Gross domestic savings and income increased 2.5% in the first quarter.
The average of GDP and gross domestic income, also known as gross domestic product measured using the production approach and considered a broader measure of economic activity, rose 2.4% in the second quarter. It had previously been estimated at 1.8%. Growth was 2.5% in the first quarter.
The Bureau of Economic Analysis also revised GDP data going back to 2021 to reflect updated information. Taken together, the figures show that the U.S. economy remained resilient despite pressure from the war involving the United States, Israel, and Iran. Supporting factors included business investment in artificial intelligence and substantial tax refunds under last year’s tax legislation.
This month, the Federal Reserve raised interest rates for the first time in three years to curb inflation. At the same time, revised second-quarter data showed that strong consumer spending continued to provide important support for economic growth.
