The Commerce Department on Wednesday revised up its growth estimate for last quarter from an initial estimate of a 4.1 percent annual rate. The second quarter marked a sharp improvement from a 2.2 percent gain in the January-March period, though some of the strength last quarter came from temporary factors, including a surge in U.S exports before tariffs were to take effect.
Economists expect growth to slow to a still solid 3 percent annual rate the rest of the year, resulting in full-year growth of 3 percent for 2018. It would be the best performance since 2005, two years before the Great Recession began.
The 4.2 percent annual growth that the government estimated for last quarter is the strongest such figure since a 4.3 percent annual gain in the third quarter of 2014. The expectation of 3 percent growth for 2018 as a whole would be up from gains of 1.6 percent in 2016 and 2.2 percent last year.
Since the recovery began in mid-2009, growth has been sub-par, with annual gains averaging just 2.2 percent, making it the weakest recovery in the post-war period.
President Donald Trump often pointed to that fact during the 2016 presidential campaign to attack the economic record of the Obama administration. He has touted the pickup in growth, as measured by the gross domestic product, as evidence that his economic program of tax cuts, deregulation and tougher enforcement of trade agreements is working. Last month, Trump proclaimed that the GDP figure showed that the United States was now the "economy envy of the world."