U.S. gross domestic product expanded at a 1.5% annualized rate from April through June, unchanged from the Commerce Department’s first estimate and decelerating from a 2.1% pace in the first quarter. Consumer spending, about 70% of economic activity, rose at a 3.4% annual clip after a 0.5% gain in the prior period, while imports climbed 12.5%—partly on computer chips and other products tied to artificial intelligence investment—and subtracted 1.64 percentage points from growth. Business investment excluding housing advanced 8.5% amid an AI spending boom, a measure of underlying strength that strips out volatile government and trade components grew 4.2% after 1.7%, and housing investment ticked up for the first time since the end of 2024. The economy has stayed resilient despite conflict with Iran and higher energy prices. Separately, a Fed-watched inflation gauge showed prices up 3.7% in July from a year earlier, matching June and remaining well above the 2% target after standing at 2.9% before U.S. and Israeli strikes on Iran in late February. Stubbornly high costs, elevated gas prices, President Donald Trump’s threatened tariffs on Canada and China, and AI-driven pressure on tech hardware prices are emerging as central issues ahead of midterm elections about 10 weeks away; the final Q2 GDP report is due Sept. 30.