The US economy is staging a slower recovery than economists expected following a rise in coronavirus cases.
The economy grew at an annualised rate of 6.5% in the second quarter, according to official data.
While gross domestic product (GDP) was ahead of the first quarter, growth was below forecasts of 8.5%
“Concerns of a resurgence of the coronavirus have been building and are reflected in the economy’s performance,” said Charles Schwab.
The investment firm’s UK director, Richard Flynn, said second quarter growth was “disappointing”, adding: “Amid the rapid spread of the delta variant and a significant easing in both monetary and fiscal stimulus, investors may have begun to worry about a faster-than-expected economic slowdown.”
On the upside, official figures from the US Commerce Department revealed that consumer spending was strong in the second quarter, rising by 11.8%.
The US Bureau of Economic Analysis said that businesses reopening and continued government support had helped boost spending.
President Joe Biden’s administration signed off $1.9tn (£1.4tn) in pandemic relief in March, sending one-time $1,400 stimulus cheques to eligible households, as well as extending pandemic-related unemployment benefits through to early September.
However, total GDP growth for the second quarter was dampened by a fall in investment in areas such as company inventories.
Robert Alster, chief investment officer at Close Brothers Asset Management: “The global industrial boom is seeing early signs of slowdown – an end was inevitable, but we are now seeing clear signals that deceleration has started.
“Consumers seem to be emerging from lockdown with increased caution, exacerbated by inflation causing an increase in the price of common goods. And with the delta variant on the rise and certain states reintroducing the mask mandate, it is clear that the US is not yet out of the woods.”