Business, Economics and Jobs

US GDP growth slows to 1.5 percent in the second quarter


Shoppers walk in New York City on July 16, 2012. Retail sales declined for a third straight month as the U.S. economic recovery remained shaky.


Mario Tama

Economic growth, as measured by real GDP, slowed to an estimated rate of 1.5 percent between April and June, compared to a rate of about 2 percent in the first three months of 2012, Politico reported.

The figures come from a US Commerce Department statement released this morning, which noted that the estimate is subject to revision in August, when the Bureau of Economic Analysis will have more data on growth.

The news, most sources have noted, increases pressure of the Obama administration as the president seeks election to a second term. Mitt Romney's campaign "seized" on the numbers, the Washington Post reported, to criticize the president's "economic stewardship."

On its blog, the White House responded to the news by saying that "while the economy continues to move in the right direction, additional growth is needed to replace the jobs lost in the deep recession that began at the end of 2007."

The slowdown comes largely from a decrease in consumer spending, which accounts for about 70 percent of US economic activity, Reuters reported. GDP measures output of goods and services, which includes all purchases and sales.

The Associated Press noted that "growth at or below 2 percent isn't enough to lower the unemployment rate." The AP quoted Dan Greenhaus, chief economic strategist at BTIG LLC, as saying, "The U.S. economy is barely growing."

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