Tax cuts and federal spending are adding fuel to the already strong economy, putting the United States on a pace for its best year of growth in well over a decade.
The Commerce Department reported Friday that gross domestic product, the broadest measure of goods and services produced in the economy, grew at a 4.1 percent rate in the second quarter of the year. Consumers led the way, shrugging off higher gasoline prices and sluggish wage growth to step up their spending on everything from cars to clothes to restaurant meals.
President Trump hailed the data as evidence that his policies on trade, taxes and other issues were working. Robust growth is good news for Republicans, who are counting on the economy to help them in midterm elections this fall
“Once again, we are the economic envy of the entire world,” Mr. Trump declared outside the South Portico of the White House, flanked by his top economic advisers.
Mr. Trump cited a long list of indicators of how well the economy has performed on his watch, some lacking context or foundation
Economists caution that the latest acceleration, while good news for American businesses and households in the short term, is unsustainable in the long term and could raise the risk that the recovery will flame out in the years ahead.
The quarter’s figures were pumped up by a range of one-time factors that are unlikely to recur. Most forecasters expect growth to cool in the second half of the year — even without factoring in the possibility of a trade war, which corporate executives in recent weeks have cited as a source of uncertainty that could force them to pare hiring and investment plans.
But there is little question that this spring was a high point in the rebound from the recession that struck a decade ago.