GDP grows by 3.4 percent rate in second quarter

Friday, July 29, 2005 | 9:36 a.m.

WASHINGTON -- The economy clocked in at a chipper 3.4 percent annual growth rate in the second quarter, fresh evidence the country's business climate is healthy despite surging energy costs.

The solid increase in the gross domestic product for the April-to-June quarter, reported by the Commerce Department today, came on the heels of a larger 3.8 percent growth rate in the opening quarter of this year.

GDP measures the value of all goods and services produced within the United States and is considered the broadest barometer of the country's economic standing. Despite elevated energy prices, consumers and businesses still managed to boost spending and investment modestly, helping to underpin overall growth in the second quarter.

In other economic news, the Labor Department reported that workers' wages and benefits grew by 0.7 percent in the second quarter -- the same as the first quarter. That suggested that recovery in the job market isn't fanning inflation on the compensation front.

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