US productivity rose unexpectedly in the second quarter, while labour costs fell, providing a bolster to the economic outlook, figures show.
Productivity - the amount of output for every hour worked - climbed to an annual rate of 4.3% in the three months to June, the Commerce Department said.
Simultaneously, labour costs dropped to 0.5% on a yearly basis.
For employers, if labour costs rise quicker than productivity, it can contribute to quickening inflation.
The productivity level was twice that forecast, and came after productivity added 2.6% in the first three months of the year.
Meanwhile the drop in labour costs reversed the rise seen in the three months to March when they were 1.2% higher.
The productivity data was viewed positively by analysts, who argue it helps keep a check on inflation at a time when firms are facing a sharp rise in costs.
Economic uncertainty
There have been signs that the US economy has fared less badly since the start of the year than previously thought.
In August, figures showed the world's largest economy expanded at a revised rate of 3.3% annually during the second quarter of 2008, much higher than its first estimate of 1.9%.
But there is still much uncertainty surrounding the outlook for the US economy.
Only a day earlier, on Wednesday, the US central bank said the economy faced slow growth and higher prices.
The Federal Reserve's so called Beige Book report said economic activity was "weak, soft or subdued" in the US, as consumers tightened their belts.
(BBC)
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