By Jim Puzzanghera, Don Lee
July 30, 2014
The economy’s strong second-quarter growth showed the recovery has regained momentum after a brutal winter and could signal a quicker end to the era of rock-bottom interest rates.
The nation’s total economic output, or gross domestic product, increased at a 4% annual rate from April through June, the Commerce Department said Wednesday.
It was a better-than-expected rebound from an alarming first-quarter contraction and confirmed experts’ assumptions that the dismal performance in the first three months was triggered in large part by severe weather across much of the nation.
“The first quarter was indeed the aberration,” said Doug Handler, chief U.S. economist at IHS Global Insight.
While I think we should be celebrating the second-quarter rebound, it’s really not a strong economic recovery. – Sung Won Sohn, an economist at Cal State Channel Islands
Although the 4% growth rate was impressive, marking just the third quarter since the end of the Great Recession that the economy grew at that pace or higher, economists cautioned not to get too excited.
About a third of that growth probably came from consumers and businesses catching up for activity lost in the first quarter. And the figure could be revised down in the coming weeks.
Overall, the economy has expanded at slightly less than 1% during the first half.
“While I think we should be celebrating the second-quarter rebound, it’s really not a strong economic recovery,” said Sung Won Sohn, an economist at Cal State Channel Islands.
Still, economists expect growth to pick up in the second half.
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