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The government revised first-quarter GDP growth up to 0.7% from 0.6%. For the last four quarters, the economy grew by just 1.91%.

In the report, personal consumption spending that fuels two-thirds of national economic activity rose at a 4.2 percent rate, slightly lower than the 4.4 percent rate estimated a month ago but still a strong underpinning to keep the economy growing.

Here's the key bit:

A prices measure favored by Federal Reserve policy-makers -- personal consumption spending excluding food and energy -- was revised up during the quarter to a 2.4 percent rate from the prior 2.2 percent estimate. This will likely be weighed by Fed officials as they meet on Thursday for a second day of a policy meeting at which they are expected to keep interest rates unchanged while reaffirming concerns over the risks of inflation.

Posted by edelfenbein at June 28, 2007 8:52 AM