Washington, Jul 27 (IANS): The US economy picked up steam in the second quarter despite punishing rate hikes and still-high inflation, the media reported. 

Gross domestic product, the broadest measure of economic output, grew by an annualized, seasonally adjusted 2.4 rate in the April-through-June period, the Commerce Department reported on Thursday.

That was a faster pace than in the first three months of the year and was also above economists' expectations for a 1.8 per cent rate, according to Refinitiv. GDP is also adjusted for inflation, CNN reported.

Economic growth in the second quarter was driven by business investment, government purchases, inventory investment, and consumer spending, though at a much weaker pace than in the first quarter.

Consumer spending, which accounts for about two-thirds of economic output, grew at just a 1.6 per cent rate in the second quarter, down sharply from a 4.2 per cent rate in the first three months of the year.

That was driven by a sharp pullback in spending on durable goods, which are products, such as cars and washing machines, meant to last at least three years, CNN reported.

Nonresidential business investment rose sharply to a 7.7 per cent growth rate in the second quarter, up from a 0.6 per cent rate in the beginning of the year.

That uptick was mostly thanks to spending on equipment, which jumped to 10.8 per cent from -8.9 per cent.

The slowdown in consumer spending reflects cooling demand, which the central bank has been trying to achieve through rate hikes.

But the report also underpins resilience in the economy, which could give the Fed enough leeway to do another hike this year, CNN reported.