Second-quarter growth was revised from 1.5 to 2.2 percent

Published October 27, 2026. This retrospective examines the first estimate of second-quarter GDP, released July 30.

The first estimate said the U.S. economy expanded at a 1.5 percent annual rate from April through June, slower than the pace in the first quarter. The second estimate kept that figure. On September 30, BEA’s third estimate raised growth to 2.2 percent. Consumer spending, exports and investment contributed, while government spending declined. The latest estimate described continued growth, not a contraction.

Why imports subtract from GDP

GDP counts goods and services produced inside the country. The accounting formula adds consumer spending, business investment, government spending and exports, then subtracts imports. Imports are removed because they were produced abroad. If a U.S. household buys an imported appliance, the purchase appears in consumer spending, while the imported value is subtracted so foreign production is not counted as domestic output.

That accounting can make a surge in imports reduce measured GDP even when consumers and businesses are buying more. It is not a direct measure of household welfare. The same report must be read through its components to see whether domestic demand strengthened or weakened.

Growth is not the same as affordability

A positive GDP rate says total production rose. It does not say that pay rose as quickly as rent, that families felt secure, or that every industry expanded. Households can face higher costs while the economy grows. National output and personal budgets answer different questions.

The annualized rate also needs translating. It expresses what the quarter’s pace would look like if it continued for a year. The actual change from one quarter to the next was smaller. BEA later issues updated estimates as more data arrive, so 1.5 percent was the first estimate, not the final word.

Why the slowdown mattered

Slower growth can mean businesses become more cautious about hiring and investment. It can also reflect temporary shifts in inventories, imports or government spending. A single quarter cannot identify which force will dominate the next one. Economists watch subsequent revisions and other data such as payrolls, incomes and spending.

For households, the July report was a mixed signal: the economy was expanding, but more slowly, while borrowing and energy costs remained high. That is not a contradiction. Growth can continue without producing immediate relief at the checkout, on a credit-card statement or at the pump.

GDP estimates arrive in three stages: an advance estimate, a second estimate and a third estimate. Each uses more complete source information. The July number was the opening estimate of the quarter, and the September third estimate revised it up to 2.2 percent. Readers should keep each release label attached. It is not accurate to call a first release final or to compare it without qualification to a more mature estimate from another quarter.

In the third estimate, published September 30, BEA revised second-quarter growth up to 2.2 percent. The advance and second estimates had both shown 1.5 percent. That means the first headline was later revised upward by 0.7 percentage point as more complete data became available. The latest record as of October 27 is 2.2 percent, and the sequence matters when describing what was known at each release.