A report from the Commerce Department showed on Thursday that the U.S. economy grew slower than initially thought in the second quarter, due to downward revisions to state and local government spending, exports, private inventory investment, and residential investment that were partly offset by an upward revision to personal consumption expenditures (PCE).

According to the second estimate, the U.S. gross domestic product (GDP) grew at a 2.0 percent annual rate in the second quarter, slightly lower than 2.1 percent reported in the advance estimate.

Economists had expected the growth rate to come in at 2.0 percent, following the second quarter's increase of 3.1 percent.

The increase in real GDP in the second quarter reflected positive contributions from PCE, federal government spending, and state and local government spending that were partly offset by negative contributions from private inventory investment, exports, residential fixed investment, and nonresidential fixed investment. Imports increased.

Meanwhile, the deceleration in real GDP in the second quarter primarily reflected downturns in inventory investment, exports, and nonresidential fixed investment. These downturns were partly offset by accelerations in PCE and federal government spending.