US ECONOMIC GROWTH FOR LAST QUARTER IS REVISED DOWN TO A 2.1% ANNUAL RATE

The U.S. economy expanded at a 2.1% annual pace from April through June, showing continued resilience in the face of higher borrowing costs for consumers and businesses, the government said this week in a downgrade from its initial estimate.

- 

The government had previously estimated that the economy expanded at a 2.4% annual rate last quarter.

The Commerce Department’s second estimate of growth last quarter marked a slight acceleration from a 2% annual growth rate from January through March. Though the economy has been slowed by the Federal Reserve’s strenuous drive to tame inflation with interest rate hikes, it has managed to keep expanding, with employers still hiring and consumers still spending.

Wednesday’s report on the nation’s gross domestic product — the total output of goods and services — showed that growth last quarter was driven by upticks in consumer spending, business investment and outlays by state and local governments. A measure of consumer prices in the report also showed inflation cooling, which could ease the pressure on the Fed to further raise interest rates.

“Lower growth and weaker increases in prices are good news for the Federal Reserve,’’ said Eugenio Aleman, chief economist at Raymond James.