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Is the U.S. economy back on track?

The U.S. economy faces a key test Wednesday when the federal government releases its first estimate of economic growth for the second quarter of 2014.

Forecasters were surprised last month when the U.S. Commerce Department said the economy had shrunk 2.9 percent in the first three months of the year, the worst performance in five years and a sign that the recovery might be losing steam. Most experts attributed the slump largely to an earlier bout of harsh winter weather and businesses adding to their inventories, and they predicted that the economy would come back strong.

Although economists have slightly ratcheted back their growth projections for the year, consensus estimates still call for second-quarter GDP of around 3 percent. Factors propelling growth in the April-to-June period include falling energy prices, stronger manufacturing activity and a growing demand abroad for U.S. exports, according to Macroeconomic Advisers.

Will the economy change much during the year's second half?

Business spending on equipment, which plummeted in the first quarter, has also revived in recent months, while consumer spending and residential and government investment are rebounding as well, other economists note. More broadly, the U.S. economy doesn't face some of the obstacles that impeded growth in 2013, when large cuts to government spending and higher taxes, among other factors, resulted in GDP expanding only 1.9 percent.

Perhaps most important for the economy, a healthier job market is buttressing consumer confidence. Data out Tuesday show it's at its highest level since October 2007, before the financial crisis began. More robust hiring by small businesses -- which account for most job creation -- is particularly encouraging, economists say.

A "further fading of the fiscal drag, a further loosening in credit constraints and a further strengthening in overseas demand should mean that GDP grows at an annualised rate of around 3 percent both in the second half of this year and throughout next year," said Paul Dales, senior U.S. economist with Capital Economics, in a note to clients.

Not all forecasters are so sanguine. The International Monetary Fund last week lowered its growth outlook for the U.S. to 1.7 percent for the year. The Federal Reserve has forecast economic growth for 2014 in the 2.1 percent to 2.3 percent range.

Federal Reserve expected to cut billions more in stimulus

The latest GDP figures will come on the same day that the Federal Open Market Committee, the central bank's interest rate-setting panel, releases its latest policy statement. The Fed is expected to affirm its commitment to keeping interest rates low for the foreseeable future, while also continuing to scale back a bond-buying program aimed at boosting growth.

"The FOMC will continue to gradually reduce its asset purchases at the subsequent two meetings, wrapping up in November 2014," predicted economists with PNC Financial Services Group.

But a second straight disappointing quarter of growth could force the Fed to reconsider its timetable for removing stimulus from the economy.

Another test comes on Friday, when the U.S. Labor Department announces how many jobs the economy added in July, along with the nation's latest jobless rate. Payrolls grew by 288,000 in June, topping forecasts, while unemployment rate fell to 6.1 percent.