U.S. economy grew 2 percent in second quarter, lifted by consumer spending. Corporate profits up 4.8 percent.

The Bureau of Economic Analysis reports U.S. Gross Domestic Product rose 2 percent in the second quarter of 2019.

Real gross domestic product (GDP) increased at an annual rate of 2.0 percent in the second quarter of 2019 (table 1), according to the “second” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 3.1 percent.

The GDP estimate released today is based on more complete source data than were available for the “advance” estimate issued last month. In the advance estimate, the increase in real GDP was 2.1 percent.

The accompanying graph shows quarterly changes since 2015. 

Reuters comments,

The downward revision was in line with ecconomists’ expectations.

The economic expansion, now in its 11th year, is under threat from the Trump administration’s year-long trade war with China, which has undercut business investment and manufacturing.

The deterioration in trade relations between the two economic giants has roiled global stock markets and triggered an inversion of the U.S. Treasury yield curve, fanning fears of a recession. While manufacturing and housing data suggest the economy continued to slow early in the third quarter, strong consumer spending, backed by the lowest unemployment rate in nearly 50 years, has tempered some concerns about a downturn.

The Wall Street Journal reports,

Corporate profits turned around in the second quarter after a slowdown early in the year and consumer spending rose faster than previously thought. That helped fuel solid, though slower, economic growth as the U.S. expansion reached its 10th anniversary.

A key measure of corporate profits—after taxes, without inventory valuation and capital consumption adjustments—rose 4.8% from the prior quarter, the Commerce Department said Thursday. That came after corporate profits dropped 1.5% in both the first quarter of this year and the fourth quarter of 2018.

The 4.8% increase in corporate profits was the largest quarterly rise since the first quarter of 2018, just after the tax overhaul was signed into law in late 2017

The Commerce Department also revised down slightly its estimate of overall second-quarter economic growth. It said gross domestic product—the broadest measure of the nation’s output of goods and services—rose at a seasonally adjusted annual rate of 2.0% in the second quarter, compared with the previous estimate of a 2.1% rise.

The latest data paint a picture of an economy that is growing thanks to support from the U.S. consumer, but businesses and exporters are struggling with trade uncertainty.

We’ll let uncertainty be the last word.