U.S. economy grows by 4.1% in second quarter

The U.S. economy grew by 4.1% in the second quarter of 2018, the Commerce Department announced Friday. It marks the fastest rate of growth since 2014.

Strong consumer and government spending fueled the increase, as did a short-term jump in trade ahead of tariffs announced by the White House and U.S. trading partners. First-quarter growth was also revised to 2.2 percent, a slight increase from the previous estimate.

Economists had expected the nation's gross domestic product -- the broadest measure of goods and services produced in the U.S. -- to reach 4.4 percent.

President Donald Trump on Friday touted the economy's performance in a press conference in front of the White House.

"Once again, we are the economic envy of the entire world," he said, adding that "these numbers are very, very sustainable."

In a speech at the White House, Trump said the country is growing "at the amazing rate" and that "we're on track to hit the highest annual average growth rate in over 13 years."

Trade deals will further help the economy and "we're going to go a lot higher than these numbers and these are great numbers," said Trump, surrounded by top administration officials on the South Lawn.

Republicans are hoping that a string of good economic news will bolster their hopes in the November midterm elections. The booming economy is the foundation of the GOP’s pitch to voters as the party tries to defend its vulnerable House majority.

The tax cut the president pushed last year is a major reason behind the recent jump in growth, economists said. But most analysts think the economy is likely to modestly slow in the second half of the year and in 2019.

"Overall, helped by the massive fiscal stimulus, the economy enjoyed a strong first half of this year but, as the stimulus fades and monetary policy becomes progressively tighter, we expect GDP growth to slow markedly from mid-2019 onwards," said Paul Ashworth, chief U.S. economist with Capital Economics, in a note to clients.

Despite the strong second quarter, the forecast for 2018 remains at 2.8 percent, according to the Federal Reserve's rate-setting body. Private-sector economists expect growth around 3 percent.

Brian Coulton, chief economist with credit ratings agency Fitch, attributed the strong quarter largely to a healthy job market, which he said is lifting consumer income and confidence. He also noted the boost to GDP from U.S. exports even amid America's ongoing trade disputes, which also fueled the pick-up in activity.

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