US economy data revised upwards

US economic growth slowed in the second quarter

The US economy performed better than initially thought in the second quarter of 2006, according to revised data from the Commerce Department.

It now says US gross domestic product (GDP) grew by an annual rate of 2.9% in the three months to 30 June, up from the initial estimate of 2.5%.

While the new figure is an improvement, it is still below Wall Street's prediction of an upward revision to 3%.

It also remains sharply down on the 5.6% growth seen in the first quarter.

Higher energy costs

The Federal Reserve voted earlier this month to halt its policy of consecutive interest rate rises, saying US economic growth, and therefore also inflationary pressure, were both now slowing of their own accord.

Analysts say higher petrol and other energy prices have been a key factor in the slowing level of US economic growth.

Stuart Hoffman, chief economist at PNC Financial Services Group, said the latest GDP figure was pretty much as expected.

"Revisions to the second quarter GDP data reflect a nip here and a tuck there rather than major cosmetic surgery and thus don't substantively change the look of the US economy," he said.