US economy grows 3.3% in 2nd Q

According to the US Commerce Department, a 3.3 percent growth was noted in the US economy during the second quarter and it was much higher than the expected 1.9% growth.

This growth is being considered a result of strong exports, weaker dollar and tax rebates that help to boost consumer spending.

Strategic Business

During the first quarter, GDP grew at a rate of 0.9 percent and a 0.2 percent contraction was noted during the last three months of 2007.

However, it has been warned by the Federal Reserve that economy will be weak in this year.

“We are beginning to see some sunlight, but we are not out of woods yet,” stated John Wilson, who is equity strategist at Morgan Keegan.

The data showed that there was a 13.2 percent increase in the exports while the government was estimating it around 9.2 percent. And there was a 7.6 percent decrease in imports as the slowdown of the US economy reduced the demands of goods imported from the other countries.

This improved trade balance increased 3.1 percent points to GDP in the second quarter and it was the biggest since 1980.

A significant slowdown was noticed in the housing market as builders limited their business to reduce their spending.

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