The US economy grew at a slightly slower rate than initially forecast in the second quarter, underscoring the weak performance of the world’s largest economy in the first half of 2016.

GDP expanded at an annualised rate of 1.1 per cent in the second quarter, compared with a previous estimate of 1.2 per cent, the Commerce Department said.

Moderating growth in the second quarter caps a disappointing first half of 2016 as economic activity grew at a slim 0.8 per cent rate in the first three months of the year.

Economists reckon the economy may have picked up steam more recently. Indeed, the growth rate accelerated to 3.4 per cent in the third quarter, according to a running forecast by the Atlanta Federal Reserve.

The more upbeat outlook for economic output, coupled with a tightening labour market and signs that inflation is firming has increased expectations that the Fed may raise interest rates at least one time this year following the December 2015 increase.

Markets pin the odds of a 2016 rate rise at 55.8 per cent, according to federal funds futures, up dramatically from late June when the fierce reaction to the UK’s Brexit vote sent the probability plunging to essentially nil.

A speech from Fed chairwoman Janet Yellen slated for later on Friday is expected to garner significant attention and may provide more colour on the central bank’s policy plans.

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