US Economy Advances More Than Expected

New reports show the U.S. economy, the world's largest, is advancing at a faster pace than some economists had predicted.

The government said Wednesday that the American economy grew by a 1.7 percent annual rate in the April-to-June period, compared to a newly calculated 1.1 percent pace in the first three months of the year.

Economists described the second quarter growth as modest, but it was nearly twice what many of them had projected. Some said it pointed to even more robust growth in the second half of the year.

The government said the recent advance was fueled by more consumer spending, a growth in exports and expanding corporate investment. That offset reduced federal government spending after Washington failed to agree on a new budget plan and automatic cuts took effect in March.

In another report, the government revised last year's U.S. economic performance upward, saying the country's overall output moved ahead by 2.8 percent, up from the 2.2 percent figure it had earlier posted.

The advancing U.S. economic indicators are likely to play a key role as policy makers at the country's central bank, the Federal Reserve, decide when to begin cutting back on their monthly $85 billion purchase of securities to pump more money into the economy.

The asset purchases have been aimed at spurring the economy and boosting job growth, but the Fed says that as the economy has improved, it is looking to curtail the program later this year and end it by mid-2014.

The central bank policy makers have been meeting in Washington this week and were expected to give their assessment of the U.S. economy on Wednesday.