The US Department of Commerce released preliminary Q2 2011 GDP data this morning (National Income and Product Accounts -- Gross Domestic Product: Second Quarter 2011 (Advance Estimate); Revised Estimates: 2003 through First Quarter 2011), and there was not much good news in the numbers.  First, US real GDP growth came in at a weaker than expected 1.3% (see Table 1).  Equally bad, prior quarters' growth was revised downward -- Q1 2011 down to 0.4% from 1.9% earlier, and Q4 2010 down to 2.3% from 3.1% earlier.  Given the negative impact of the deadlock on raising the US Federal debt ceiling -- even if a default is avoided at the last minute -- it is hard to see US real GDP growing faster than 2% in Q3 and Q4 2011, and very possibly not much more than 1.5%.

Table 1, US Real GDP Growth Rates, Before and After July 29, 2011 revisions