The US economy accelerated in the second quarter as consumers ramped up spending and businesses invested more on equipment, confirming that the sluggish performance early in the year was temporary.
The increase in output was in line with economists' expectations.
Manufacturing activity rose 1.1 percent, driven by makers of petroleum and coal products, as well as motor vehicles and parts.
But the contribution to growth from home buying had its biggest fall in almost seven years, slipping 6.8 percent. President Donald Trump has set an ambitious 3.0 per cent growth target for 2017. But those effects were offset by an increase in other types of investment, greater consumer spending and stronger exports.
Andrew Hunter, US economist at Capital Economics, said: "Looking ahead, the strengthening labor market should continue to support real consumption growth, while the business surveys remain at a high level and suggest that investment will continue to recover".
Much of the strength in the April-June frame came from consumer spending, which grew at a 2.8% rate, up from a 1.9% growth rate in Q-1. That was an acceleration from the 1.9 per cent pace logged in the first quarter.
The U.S. economy's second-quarter rebound puts the expansion back on its familiar, steady path more than it heralds anything new and exciting.
Nonresidential fixed investment, a measure of corporate spending on structures and equipment, climbed at a pace of 5.2 percent in the second quarter, down from a 7.2 percent growth rate in the previous quarter. That would follow two straight quarters when investment in homebuilding supported GDP growth.
Businesses continued to carefully manage their inventories in the second quarter but spent more in some places.
The second quarter is the first one that is more a Trump quarter than an Obama quarter, though of course we'll be saddled with Obama's lousy economic program for a long time. Nondurable goods spending was also stronger, up 3.8 percent in the second quarter. Such an adjustment was made in the GDP growth for January, February, and March, which showed growth back then was even slower than first thought.