Obama's 'Recovery Summer' – Growth Slows to 2.4%

Restrained by a tiring consumer, the U.S. economy grew at a slower pace than was expected last quarter. The government also lowered past GDP readings as far back as 2007.

The Commerce Department said Friday that gross domestic product – the value of all the goods and services produced in the U.S. – rose by 2.4% in the second quarter, a tenth of a percent below what economists had been projecting.

While not a dramatic shortfall, the GDP report will do nothing to ease concerns about the struggling economy or worries about job growth. In the first quarter, the economy grew at a 3.7% clip.

In the second quarter, growth consumer spending fell to 1.6% from the first quarter’s 1.9%. That’s of particular concern as consumer spending represents a large chunk of the U.S. economy, by some estimates 70%. Indeed, in testimony last week, Federal Reserve chairman Ben Bernanke emphasized that it will be consumer spending that will help determine the strength of the nation’s economic recovery.

On the other hand, spending by businesses jumped 21.9% in the quarter, versus the 20.4% of the first quarter.