MercoPress. South Atlantic News Agency

US economy expands 3,3% in second quarter

The US economy expanded 3,3% during the second quarter, a tenth less than expected reported Wednesday the US Commerce Department.

In the first quarter the GDP increased 3,8%, taking the half year growth to 3,6% considered a solid performance despite the impact of steep energy prices.

Apparently a surge in imports and a slight drop in consumer spending, which makes up 70% of the country's GDP, were behind the lesser than expected growth.

However growth is likely to bounce back in the third-quarter according to analysts who anticipate an annual growth of 4% for the July-September period.

But as the impact of steep energy prices is more deeply felt, the final quarter of 2005 performance is forecasted to slow down.

The fourth quarter will also have to absorb the impact of the cost of hurricane Katrina, which has ravaged the Gulf Coast area in the South.

If supply disruptions trigger more rises in oil prices the economic impact could be offset by efforts to rebuild the stricken region, said analysts.