CNBC reported that the U.S. economy expanded at a slower-than-expected annual rate of 1.5% during the second quarter, while inflation remained above the Federal Reserve’s target, according to Commerce Department data released Thursday.

Gross domestic product, which measures the value of goods and services produced, fell short of economists’ expectations for 1.8% growth and followed a 2.1% increase in the first quarter.

The Fed’s preferred inflation measure, the personal consumption expenditures price index, showed annual inflation at 3.7% in June. Excluding food and energy, core inflation rose 3.3% from a year earlier, matching forecasts but remaining well above the central bank’s 2% goal.

Consumer spending increased 2.1% in the quarter, while personal expenditures rose 0.3% in June. However, the personal savings rate fell to 2.7%, its lowest level in four years, as consumers continued drawing on savings.

Read more at CNBC.