US GDP Growth Decelerates in the Second Quarter   On August 29, the US Bureau of Economic Analysis published its second estimate of GDP growth, estimating the US economy grew at an annual seasonally adjusted rate of 2.0% in the second quarter of 2019, slowing from 3.1% in the first quarter of 2019. GDP growth in the second quarter was driven by positive contributions from personal consumption expenditures, federal government spending, and state and local government spending. However, these were partly offset by negative contributions from private inventory investment, exports, nonresidential fixed investment and residential fixed investment. [caption id="attachment_95649" align="aligncenter" width="700"] Source: Bureau of Economic Analysis[/caption]   US Industrial Production Declines During the Second Quarter US industrial production slipped 2.1% in the second quarter, continuing and quickening the 1.9% contraction in the first quarter of 2019. Consumer goods output fell 2.8% in the quarter, while durable goods rose 1.9%. Clothing was up 4.5% in the quarter, while manufacturing output fell 3.1%. [caption id="attachment_95650" align="aligncenter" width="700"] Source: US Federal Reserve[/caption]   Personal Consumption Expenditure Accelerates During the Second Quarter US real personal consumption expenditures (PCE, or consumer spending) increased at an annual rate of 4.7% during the second quarter of 2019, soaring from just 1.1% in the first quarter of 2019. In June, real personal disposable income (PDI, income after paying tax and other deductions) increased 0.3% while real PCE increased 0.2%. The increase in real PDI in June can be attributed to increases in wages and salaries, government social benefits to persons, and supplements to wages and salaries. The increase in real PCE in June was a result of strong spending on nondurable goods and services. [caption id="attachment_95651" align="aligncenter" width="700"] Source: Bureau of Economic Analysis[/caption]   China’s GDP Growth Slows   China’s economy grew 6.2% year over year in the second quarter of 2019, the slowest rate in the past 27 years, but matching estimates by economists surveyed in a Reuters poll and within the Chinese government’s target range of 6.0-6.5% for the year. The data reflects weakening demand at home and abroad as trade tension with the US mounted. More fiscal measures are likely to boost consumption and revive business confidence. [caption id="attachment_95652" align="aligncenter" width="700"] Source: National Bureau of Statistics of China[/caption]   China’s Industrial Production Shows Rising Momentum In June 2019, China’s industrial production was up 6.3% year over year in real terms, above the 5.0% growth rate in May and 5.4% in April, and above the 5.2% estimate of analysts polled by Reuters. Industrial production of mining and quarrying increased 7.3% year over year, manufacturing increased 6.2%, and production and distribution of electricity, heating power, gas and water were up 6.6%. [caption id="attachment_95653" align="aligncenter" width="700"] Source: National Bureau of Statistics of China[/caption]   China Real-Terms Per Capita Expenditure Growth Continues to Slow Accumulated per capita expenditure in real terms increased 5.2% year over year in China in the second quarter of 2019, slower than the 5.4% growth registered in the first quarter of 2019. Retail sales grew 8.6% year over year in the second quarter. In particular, retail sales in June grew 9.8% year over year, largely driven by the mid-year 6.18 Shopping Festival, a major annual online shopping festival in China. [caption id="attachment_95654" align="aligncenter" width="700"] Source: National Bureau of Statistics of China[/caption]