U.S. economy slowed to 1.5% growth rate in Q2; June core inflation at 3.3%

A person shops for ice cream in the freezer aisle of Safeway on July 20, 2026 in San Francisco, California. Heather Diehl | Getty ImagesEconomic growth was weaker than expected in the second quarter while inflation in June held well above the Federal Reserve's goal, the Commerce Department reported Thursday.Gross domestic product, a broad measure of goods and services, increased just 1.5% for the April-through June period, according to Bureau of Labor Statistics numbers adjusted for seasonality and inflation.Economists surveyed by Dow Jones had been looking for a growth rate of 1.8%, following the 2.1% increase in the first quarter.A separate report showed that the personal consumption expenditures price index, which is the Federal Reserve's primary forecasting gauge, fell a seasonally adjusted 0.1% for the month, putting the annual inflation rate at 3.7%. The readings were in line with forecasts.Excluding food and energy, core PCE posted a monthly increase of 0.1% and an annual level of 3.3%, against respective forecasts for 0.2% and 3.3%.While the Fed technically uses the headline PCE number as its gauge for setting policy, most officials consider core inflation as a better indic...