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Struggling U.S. Economy Propped Up by Consumer-Spending Gain

  • First half of year represents weakest start since 2011
  • Companies cut back on stockpiles, equipment, construction
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U.S. Economy Expands Less Than Forecast

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The U.S. economy stumbled in the first half of 2016 as companies retrenched, leaving consumers to shoulder the burden of sustaining growth heading into the presidential election.

A 4.2 percent gain in household purchases in the second quarter, among the biggest of the current expansion, was the lone bright spot in an otherwise bleary picture as the economy had its worst first half since 2011. Businesses hunkered down, trimming inventories and reducing outlays on equipment and construction projects, while government agencies also cut back. That limited the gain in gross domestic product last quarter to a 1.2 percent annualized rate, figures from the Commerce Department showed Friday, less than half the advance projected by economists in a Bloomberg survey.