US Commerce Department revises economic growth upwards

The US economy grew at its fastest pace in more than two years in the second quarter of 2014, according to revised figures from the US Commerce Department.

The country's GDP increased at an annual rate of 4.6 per cent between April and June, making it the best performance since the fourth quarter of 2011. This is an improvement on the 4.2 per cent previously estimated.

The revision was due to larger rises in exports and business investment, including manufacturing, trade and housing. Exports increased by 11.1 per cent from the previous three months, while business spending rose by 9.7 per cent. All categories were revised upwards except consumer spending, which stayed at 2.5 per cent. 

The strong growth follows a 2.1 per cent contraction in the first quarter, which was blamed on harsh winter weather, which discouraged shoppers and hampered manufacturing.

Analysts commenting on the Q2 figures were optimistic about the health of the US economy: "The data signals an even stronger rebound from the decline seen in the first quarter, when extreme weather battered many parts of the economy," Chris Williamson at Markit Economics told the BBC.

"However, the impressive gain in the second quarter looks to be far more than just a weather-related upturn, with evidence pointing to an underlying buoyant pace of economic expansion. Survey data in particular indicate that strong growth has persisted throughout the third quarter," he added.

US stock index futures were higher today (September 26th) after Wall Street hit new lows yesterday on weak US economic data and Apple's iPhone software glitch.

The Standard & Poor’s 500 Index was at a two-month low due to fresh reports showing unemployment benefits went up last week.

Another report said equipment orders decreased last month, while Apple and other technology companies slipped after a problematic software update for the iPhone.

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