WASHINGTON DC: Following gloomy US consumer confidence figures for July [WAMN: 30-Aug-06] and consequent dark prophecies, the federal government says the nation's economy slowed less in the second quarter than previously estimated.

The report by the Commerce Department showed GDP rose at an annual rate of 2.9%, up from the 2.5% reported in July.

Wages increased at an annual rate of 7.6% in Q2 after a 13% surge in the previous three months. Not only do faster wage gains give Americans the means to overcome higher fuel costs, they also pose a risk that companies will need to raise prices.

Consumer spending, which accounts for more than two-thirds of the economy, expanded at a 2.6% annual pace compared with the 2.5% reported last month. It also gained 4.8% on Q1 2006.

Data sourced from bloomberg.com (USA); additional content by WARC staff