The economy grew at an annual rate of 2.9% in the second quarter of 2006, compared with 5.6% in the first quarter, according to the "preliminary" estimates released by the U.S. Bureau of Economic Analysis. The growth rate was revised up 0.4 percentage point from the "advance" estimates released in July. BEA also released its first estimate of second-quarter corporate profits, which increased 20.5% from the same quarter a year ago.

The deceleration in second-quarter GDP growth primarily reflected a deceleration in consumer spending on durable goods, a downturn in investment in equipment and software, and a downturn in Federal government spending. The upward revision from the advance estimates reflected revisions to exports of goods, investment in nonresidential structures, and inventory investment.

Excluding food and energy prices, the price index for gross domestic purchases increased 2.9% in the second quarter, compared with an increase of 3.0% in the first.

Current-dollar GDP -- the market value of the nation's output of goods and services -- increased 6.3%, or $201.3 billion, in the second quarter to a level of $13,209.7 billion. In the first quarter, current-dollar GDP increased 9.0%, or $277.9 billion.