US Q2 GDP Rises 3% on Import Drop, Outlook Uncertain

The U.S. economy grew at a 3% annualized rate in the second quarter of 2025, rebounding from a 0.5% contraction in the previous quarter, according to Commerce Department data. The growth was primarily driven by a significant drop in imports after businesses accelerated purchases early in the year to avoid tariffs, which artificially boosted GDP figures. Consumer spending increased only modestly, and business investment remained weak, casting doubt on the true strength of the recovery. Economists warn that ongoing tariff policies may be distorting economic data and expect growth to slow in the second half of the year. Unemployment remains low and consumer confidence has improved, but uncertainty persists regarding the long-term impact of trade disputes and fiscal policy. The Federal Reserve is expected to keep interest rates steady as it evaluates mixed economic signals.