The U.S. economy returned to growth in the second quarter after contracting in the first, largely due to trade swings.

The Commerce Department said U.S. gross domestic product—the value of all goods and services produced across the economy—rose at a seasonally and inflation adjusted 3.0% annual rate in the second quarter.

The reading exceeded the 2.3% growth that economists surveyed by The Wall Street Journal expected.

It followed a first quarter where GDP shrank at a 0.5% annual rate as businesses loaded up on imports to get ahead of the Trump administration’s anticipated tariffs.

An underlying measure of combined private consumer and business demand in the economy weakened.

Consumer spending, the engine of the U.S. economy which accounts for roughly two-thirds of total output, increased at a 1.4% pace, picking up from the first quarter as a steady labor market underpinned households’ spending power. But consumer spending was offset by weaker business spending.

Contributions to quarterly change in real GDP for select categories

Final sales to private domestic purchases, which track demand from businesses and consumers but not the more volatile government, inventory and international trade data, rose at a 1.2% rate in the second quarter. That was slower than 1.9% the prior quarter, and suggested underlying demand from businesses and consumers weakened.

Growth in business investment eased, dragged down by weaker investment in buildings and equipment. The housing sector, hard-hit by high borrowing costs, remained a drag on the economy.

Trade swings continued to play an outsize role in the second quarter. Imports plunged at a 30.3% pace after businesses front-loaded purchases in the first quarter, while exports fell at a 1.8% annual rate.

Inventories—specifically, the pace of businesses restocking their shelves—subtracted more than 3 percentage points from the headline growth number.

Stock futures were steady after the report was released.

Federal Reserve officials have signaled they will be holding rates steady at their current policy meeting, which concludes later Wednesday. They have cited a solid economy and elevated inflation as reasons to keep rates on hold while they see how the Trump administration’s policies impact the economy.

Wednesday’s GDP report showed prices excluding volatile food and energy categories rose an annualized 2.5% in the second quarter, cooling from the first quarter but still above the Fed’s 2% target.

Later this week, the Labor Department will release its jobs report for July. Economists surveyed by The Wall Street Journal expect it will show a cooling in the labor market, with employers adding an estimated 100,000 new jobs, down from 147,000 in June.

The report bookends a half-year that was beset by economic uncertainty over the administration’s policies on tariffs. President Trump has made tariffs a cornerstone of his economic agenda, saying that they will in the long term make America richer and bring back manufacturing jobs.

The second quarter started with Trump announcing globe-spanning tariffs and ended with him delaying threats to raise tariffs beyond the 10% he broadly imposed. His next deadline is Aug. 1, when tariffs are slated to rise for many countries without trade deals.

The delays in higher tariffs helped ease some consumer and investor concerns. Employers added just shy of 150,000 jobs a month on average in the second quarter, up from 111,000 a month in the first.

Consumers have been cautious as they watch prices to see whether companies will start passing along more tariff-related costs.

The unemployment rate, a key barometer of economic health, was a low 4.1% in June. Consumer sentiment, which tanked early this year on tariff concerns, has ticked up in recent months.

Still, signs are mounting that consumers and businesses are in wait-and-see mode ahead of Trump’s Friday deadline, according to economists. While the Labor Department said Tuesday that layoffs remained low in June, hiring and job openings weakened.

Procter & Gamble, long a bellwether for the health of the U.S. consumer economy, said Tuesday that American shoppers are using up their pantry inventory, delaying purchases and shopping at stores less frequently.

“We really see that the consumer is under some level of stress,” said Andre Schulten, chief financial officer of the maker of Tide detergent, Charmin toilet paper and Pantene shampoo.

Still, Trump’s priorities, including tariffs and deportations, haven’t had a major economic impact thus far. Although inflation picked up moderately in June, according to the Labor Department’s consumer-price index, it hasn’t accelerated dramatically.

“We’ve basically been in this soft landing now for some time period,” JPMorgan Chase Chief Executive Jamie Dimon said earlier this month, as the bank reported better-than-expected results for the second quarter. “It’s been resilient. Hopefully that will continue.”

Some economists expect the Trump administration’s trade and immigration policies will take time to affect inflation and the labor market.

“If you take a step back from all the noise, and all the announcements, and all the on-and-off narrative around tariffs, around immigration, around tax, around regulation, then you really start to see the effects of all these policy developments and the policy uncertainty affecting economic activity,” said Gregory Daco, chief economist at EY Parthenon.