U.S. economy slowed in second quarter as Iran war weighs on growth

The nation’s gross domestic product grew at an annual rate 1.5% in the second quarter, the Commerce Department said Thursday, weaker than economists expected and a sign the Iran war is hurting growth.

Economists polled by Reuters predicted GDP would rise at an annualized rate of 2.1% for April to June. GDP measures the total value of goods and services produced in the U.S. The economy grew at a 2.1% rate in the first quarter.

The reading shows an economy grappling with the impact of the conflict in the Middle East, which has disrupted shipping in the Strait of Hormuz and driven up global energy costs. In the second quarter, a surge in oil prices lifted U.S. gasoline prices from an average of $2.98 a gallon just before the war started in late February to well over $4.

Despite those pressures, U.S. consumers continue to spend at a healthy clip in the second quarter, the Bureau of Economic Analysis said in its latest snapshot. 

— This is a developing story and will be updated