WASHINGTON — The U.S. economy grew from April through June at an annual rate of 1.7 percent — a sluggish pace but stronger than in the previous quarter. Businesses spent more, and the federal government cut less, offsetting weaker spending by consumers.
The government on Wednesday sharply revised down its estimate of growth in the January-March quarter to a 1.1 percent annual rate from a previously estimated 1.8 percent rate.
Though growth remains weak, the pickup last quarter supports forecasts that the economy will accelerate the rest of the year. Economists think businesses will step up investment, job growth will fuel more consumer spending and the drag from government cuts will fade. If so, the Federal Reserve could scale back its stimulus later this year.
The April-June growth figure indicates that "the recovery is gaining momentum," Paul Ashworth, an economist at Capital Economics, said in a note to clients.
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