Economic activity has rebounded strongly in the US economy since the relatively mild recession experienced last year, helped by the accommodative stance of monetary and fiscal policies, and unusually buoyant productivity growth. GDP rose by 1½ per cent in the first quarter, the fastest quarterly rate of growth since the end of 1999. Although recent monthly data have been somewhat mixed, on balance they suggest that economic activity continued to strengthen in the second quarter but at a slower pace than earlier in the year.