US growth revised down slightly in Q2 amid weak business investment

The world's largest economy grew a little more slowly in the second quarter than previously thought, with new official data released Thursday showing weaker oil exports and local government spending.

The confirmed slowdown underscored the challenges facing President Donald Trump, who is touting his economic policies as he seeks reelection while prosecuting a grinding trade war with China.

GDP expanded 2.0 per cent in the April-June period, down a notch from the initial 2.1 per cent growth estimate reported last month, and well below President Donald Trump's three per cent target, according to the Commerce Department.

Recession indicators in recent weeks have begun to flash warning signs, and though the American economy is still outpacing the rest of the industrialised world, it has begun to sputter worryingly in some areas.

Consumer spending remains robust and corporate profits rose in the second quarter, after falling at the start of the year, but business investment stalled out, according to the report.

And the China trade war could darken the picture in the third quarter as several companies warned in their earnings reports Thursday that Trump's latest round of China tariffs were a threat to profits.

Clothing retailer Abercrombie & Fitch said two coming waves of tariffs should wipe out about $6 million in profit in the fall shopping season.

RDQ Economics said the latest GDP numbers were "the proverbial mixed bag."