Recent gross domestic product data indicates a slight bounce in revised numbers concerning the U.S. economy. CBS News' Kelly O'Grady reports.

Washington

A revised GDP report shows the U.S. economy expanded at an annual rate of 3.3% in the second quarter, up from the initial estimate of 3%. The increase was partly driven by consumer spending, which grew by 1.6%, slightly higher than earlier calculations. 

Economists note that while the growth is positive, it follows a first quarter marked by a 0.5% contraction, largely due to businesses importing goods ahead of new tariffs. The impact of trade policies and tariffs remains significant, and analysts are watching the remainder of the year for a clearer picture of the economy's health.

New data signals slight bounce in U.S. economy

Welcome back. Let's get to today's money watch. A new GDP report just dropped in GDP. That means gross domestic product. The report shows GDP increased at an annual rate of 3.3% in the second quarter of 2025. The CBS News Money Watch correspondent Kelly O'Grady. She is here to help us break all of it down. Kelly, thank you for joining us today. What does the report, what is it telling us about the current health of the economy right now? So it tells us that the economy is growing faster than we originally thought in the second quarter. So remember, these GDP estimates, we get three of them in total, and this is the second one. And so when we go back to the first one, I think it was about a month ago or so, it showed that the economy grew 3% in the previous quarter. So this is actually revised up to 3.3. And so what that tells you is it's better than we expected it to be originally. The reason, or one of the reasons driving that is consumer spending was a touch higher than was originally calculated. It came in at a growth of 1.6% versus 1.4%. And so that really sort of drove things up a little bit. Just to put it in context, 1.6% in terms of consumer spending, it's not anything to write home about. And it does speak to some of that pullback that we have seen more broadly with tariffs and trade uncertainty. That being said, it's positive and that is good news. So what I will though, is it sort of an asterisk, is that we've got another estimate coming, the third estimate that'll be out in about a month or so. So these things could change. Okay. And Kayla, you mentioned tariffs earlier. So what role do they play in this as businesses react and anticipate changing trade policies? Yeah. So the first two quarters of this year, the GDP numbers have been really dependent on these changes in trade policy. You go back to the first quarter, we actually saw negative growth. The final estimate came in at a loss of 0.5%. And the reason was a lot of businesses were importing a ton of items ahead of those tariffs taking place because they didn't want to pay the import taxes. They wanted to get them in before they took effect. And when you calculate GDP, you take all your exports as a country and you subtract off your imports. So when you've got a really big import number, that makes it negative often if it's higher than the export number. And so that's what happened in the first quarter. In the second quarter, you saw a big swing. There wasn't as many imports because all those companies brought all that in ahead of the deadline. And so really what economists that I'm speaking to have been telling me is the first two quarters, look, we like the fact that this most recent quarter was higher, but it's offsetting that first lower quarter. So really it's going to be about the back half of the year to understand how tariffs are impacting and really what the health of the U.S. economy is. All right. Kelly O'Grady, thank you so much for joining us today. Appreciate your time.

It's been 13 days since President Trump said he could strike a peace deal in Ukraine, following his meeting with Russia's leader, Vladimir Putin. But Russia shows no signs of backing down, launching an aerial assault on Kyiv.

Kyiv

Ukraine Invasion

Russian attack on Kyiv kills more than a dozen people

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Minneapolis

Minneapolis officials call for stronger gun laws after school shooting

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Annunciation school shooter had knowledge of church he targeted

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White House reacts to CDC director refusing to step down from role

In Tehran on Thursday, Iran’s currency traded at over 1 million to $1. At the time of the 2015 accord, it traded at 32,000 to $1, showing the currency’s precipitous collapse in the time since.

Tehran

Europe prepares sanctions as Iran's currency falls

Two children, ages 8 and 10, were killed in a school shooting at Annunciation Church in Minneapolis. The FBI is investigating the shooting as an act of terrorism and a hate crime targeting Catholics. Warning, this video is difficult to watch.

FBI investigating Minneapolis Catholic school shooting as hate crime

UN officials and aid agencies have warned that famine in Gaza is no longer a looming threat but a present reality, with children increasingly dying of hunger. In a blunt address to the UN Security Council, officials described the famine and widespread hunger in the enclave as “engineered” and “man-made” disasters.

New York

Middle East Conflict

UN Security Council affirms Gaza famine is manmade

Denmark summoned the top U.S. diplomat in the country to protest what Danish officials say is an unprecedented effort by people close to U.S. President Donald Trump to conduct secret influence operations in Greenland.

Copenhagen

Denmark accuses U.S. of covert operations in Greenland

Two young children were killed, and 17 others were injured in a shooting during a Catholic Mass packed with young students in Minneapolis. The gunman is also dead.

Minneapolis Catholic school shooting leaves two children dead

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Nuuk

Denmark summons U.S envoy over claimed interference in Greenland

SpaceX on Tuesday launched its Super Heavy-Starship, the most powerful rocket in the world, for a test flight after three other flights failed earlier this year. NASA hired SpaceX to build a lunar lander version of Starship to carry astronauts to the moon.

Starbase

SpaceX launches Super Heavy-Starship in test flight

The United States has doubled tariffs on many imports from India to 50 percent, as U.S. President Donald Trump followed through on his threat to punish New Delhi for buying discounted Russian oil.

New Delhi

Global Tariffs

U.S. raises India tariffs to 50 percent over Russian oil purchases

President Donald Trump said he would seek the death penalty for murders in Washington, as part of a crackdown on what he calls out-of-control crime in the US capital.

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Tel Aviv-Yafo

Protesters urge Netanyahu to reach hostage deal

Cracker Barrel says it will go back to its old logo after facing intense backlash and seeing its company value to sink by nearly $100 million after switching to a new design last week. In a statement, Cracker Barrel thanked their guests for sharing their voices.

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The small West Tennessee town of Mason, just 2 square miles in size, is home to about 1,000 people. But its residents are now divided by what a new immigration detention facility will mean for the area.

Mason

Small Tennessee town divided over new ICE detention facility

A standoff is brewing between President Trump and economist Lisa Cook. Mr. Trump tried to fire her, claiming "there is sufficient cause" to believe that Cook made false statements on one or more mortgage agreements.

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Protesters demanding an end to the Gaza war and the return of hostages to their homes took to the streets in Israel on Tuesday ahead of a security cabinet meeting scheduled for the evening.

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Australia accused Iran on Tuesday (August 26) of executing two antisemitic arson attacks in the cities of Sydney and Melbourne and gave Tehran's ambassador seven days to leave the country, its first such expulsion since World War Two.

Council of the City of Sydney

Australia expels Iranian envoy over antisemitic attacks

President Donald Trump announced the removal of Federal Reserve Governor Lisa Cook, the only Black woman to serve on the board. Critics call it an attack on the Fed's independence, while Cook says no legal cause exists for her firing.

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Texas

Rise of AI

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Strikes on the Nasser hospital in Gaza that left at least 20 people dead, including rescuers, journalists and health-care workers are being met with global outrage. The Israeli military is investigating what Israel Prime Minister Benjamin Netnayahu called a ‘tragic mishap.’

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Kilmar Abrego Garcia is back in ICE custody and is facing deportation to Uganda, the Department of Homeland Security says, after he was released from criminal custody last week.

Baltimore

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Ukrainian President Volodymyr Zelenskyy said he will meet with the U.S. and other countries this week to discuss a potential meeting with Russian President Vladimir Putin aimed at reaching a ceasefire.

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Chicago

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Jerusalem

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National Guard patrolling Washington DC begin carrying weapons

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Breakdown