The US economy expanded at a stronger-than-expected annualised pace in the second quarter of 2026, the Commerce Department's Bureau of Economic Analysis reported on Thursday, defying concerns over tariff-driven inflation. The advance estimate showed gross domestic product growth outpacing the consensus forecast compiled by Reuters and Bloomberg.

The reading followed a first quarter distorted by a surge in imports as companies stockpiled goods ahead of higher US tariffs. Analysts at Goldman Sachs and JPMorgan had expected a rebound as that trade drag reversed, with consumer spending and business investment providing underlying support.

The GDP release arrived hours before the Federal Reserve's Federal Open Market Committee concluded its two-day meeting, at which the central bank was widely expected to hold its benchmark rate steady. Fed Chair Jerome Powell has repeatedly cited uncertainty over the inflationary impact of tariffs as a reason for caution on further cuts.

Economists cautioned that the headline figure masked softer details, including moderating consumer momentum and the effect of import swings on the trade balance. The report also came alongside data on personal consumption and the Fed's preferred inflation gauge, the core PCE price index, which markets scrutinised for signs of tariff pass-through.

"The economy is holding up better than the headlines suggest, but the second half will test how much of the tariff burden lands on households," said Diane Swonk, chief economist at KPMG, in a note to clients ahead of the release.