US productivity grew more than expected in the second quarter as hours worked rose at their fastest pace in 1-1/2 years, leading to a modest increase in labour costs that could keep inflation muted.
The trend in productivity, however, remains weak, suggesting robust economic growth will be hard to achieve, reports Reuters.
US President Donald Trump has vowed to boost annual growth to 3.0 per cent through tax cuts, infrastructure spending and regulatory rollbacks.
The Labour Department said on Wednesday that nonfarm productivity, which measures hourly output per worker, rose at a 0.9 per cent annualised rate in the April-June period.
First-quarter productivity was revised to show it edging up at a 0.1 per cent pace instead of being unchanged as previously reported.
Compared to the second quarter of 2016, productivity increased at a 1.2 per cent rate, the strongest performance in two years.
Economists had forecast productivity increasing at a 0.7 per cent pace in the second quarter.