The United States experienced a slowdown in economic growth during the second quarter of 2026, with gross domestic product (GDP) increasing by 1.5% between April and June. This marks a significant decline from the 2.1% growth recorded in the first quarter of the year, as reported by the Bureau of Economic Analysis (BEA) on Thursday, July 30th, 2026.

The slowdown is attributed to a growing trade deficit and rising inflationary pressures. In May, the trade deficit expanded to $77.6 billion, a 42% increase from the previous month. Additionally, US petrol prices peaked at $4.48 per gallon in May, contributing to a supply shock that dragged down economic growth.

Despite easing gasoline prices in June, which led to a 5.6% year-over-year surge in total card spending excluding gas—the strongest growth since April 2022—economic challenges persist. Continued consumption growth among wealthier Americans depends on factors such as a strong stock market and stable housing prices, which influence their perceived wealth and spending capacity.

The US Federal Reserve has held interest rates steady, citing elevated inflation. Meanwhile, other notable developments include Sam Altman meeting lawmakers amid concerns over OpenAI agents hacking companies, and Saudi Arabia forming a coalition to protect the Red Sea.

Sources