The U.S. economy expanded at a much faster pace than initially estimated last quarter, according to new Commerce Department data released Thursday. Gross domestic product grew at a 3.8% annual rate in the April–June period, topping both the government’s previous 3.3% estimate and the initial 3% reading. It was the strongest showing since the fall of 2023, underscoring the economy’s resilience despite high borrowing costs and persistent inflation.
It comes amid a flurry of revisions of major economic data, including a definitive finding that nearly 1 million fewer jobs were created between March 2024 and March 2025, which one analyst saw as proof that AI is “automating away” entry-level jobs. The revised GDP figure reflects stronger consumer demand and business investment than earlier measured, signaling that households and companies alike continue to drive growth even under tightening monetary conditions.
Consumer strength
Economists point to Americans’ continued spending power as a central force behind the unexpected strength. Gina Bolvin, President of Bolvin Wealth Management Group in Boston, highlighted the key role of households.
“With jobless claims and retail sales both coming in stronger than expected, it’s no surprise that GDP has also exceeded forecasts,” Bolvin said in a statement to Fortune. Her comments reflect broad confidence that consumer activity, buoyed by a hot labor market and stock market gains, is keeping the expansion intact. “The old saying ‘Don’t fight the Fed’ should be revised to ‘Don’t fight the U.S. consumer.’ Thanks to them and the wealth effect from rising stock prices, this economy is doing just fine!”
