FILE—In this Dec. 18, 2020, file photo, a person passes the office of the California Employment Development Department in Sacramento, Calif. The recession that broke out with onset of the coronavirus pandemic officially ended in April 2021, making it the shortest downturn on record, according to the committee of economists that determines when recessions begin and end.
WASHINGTON — Fueled by vaccinations and government aid, the U.S. economy grew at a solid 6.5% annual rate last quarter in another sign that the nation has achieved a sustained recovery from the pandemic recession.
The total size of the economy has now surpassed its pre-pandemic level.
Thursday’s report from the Commerce Department estimated that the nation’s gross domestic product — its total output of goods and services — accelerated in the April-June quarter from an already robust 6.3% annual growth rate in the first quarter of the year.
The quarterly figure was less than analysts had expected. But that was mainly because supply chain bottlenecks exerted a stronger-than-predicted drag on companies’ efforts to restock their shelves. The slowdown in inventory rebuilding, in fact, subtracted 1.1 percentage points from last quarter’s annual growth.
By contrast, consumer spending — the main fuel of the U.S. economy — was robust last quarter: It advanced at an 11.8% annual rate.
For all of 2021, the economy is expected to expand perhaps as much as 7%.
Despite the lower-than-expected second-quarter growth, Lydia Boussour, lead U.S. economist at Oxford Economics, still foresees solid gains ahead, with growth of around 7% for all of 2021.