US growth revised down, outlook remains weak

US economic growth in the second quarter was not as good as previously estimated. Reuters reports:

The Commerce Department said gross domestic product, the measure of total goods and services output within U.S. borders, expanded at a 2.8 percent rate from April to June, rather than the 3.3 percent rate it had estimated a month ago...

Growth in consumer spending was weaker than first estimated, pulling down the estimate of overall growth, while businesses made bigger cuts to investments, a sign confidence was sagging even before financial market turmoil deepened.

On the day, US investors didn't look too concerned.

Stocks on Wall Street gained by the close, overcoming earlier losses, as traders clung to hopes that the government would manage some kind of bailout for the beleaguered financial system.

But over the past month, consumers have become more pessimistic.

The Reuters/University of Michigan Surveys of Consumers said its final consumer sentiment index reading slipped to 70.3 from 73.1 in early September -- its worst slide within a single month since August 2005, when Hurricane Katrina caused widespread dislocation.

And broader leading indicators point in the same direction, according to another Reuters report.

The Economic Cycle Research Institute...said its Weekly Leading Index fell to 122.2 in the week to Sept. 19, its lowest reading since the week to April 25, 2003, when it stood at 120.7.

Last week's figure was 125.0, revised from 125.1.

Its annualized growth rate plunged to negative 12.3 percent from minus 11.5 percent in the previous week, matching a low reached in June 6, 1980 according to ECRI data.