Gross domestic product likely expanded at a 1.5 percent annual rate between April and June, according to a Reuters poll, after rising 1.9 percent in the first three months of the year.

That would mark the weakest pace of growth since the second quarter of 2011.

"The economy is struggling to maintain altitude," said Robert Dye, chief economist at Comerica in Dallas.

The ailing economy could cost President Barack Obama a second term in office when Americans vote in November.

Consumers are wary of spending in an economy that still has not fully recovered from the financial crisis and the recession in late 2007 through mid-2009, with the nation's unemployment rate still at 8.2 percent. That reluctance is reflected in retail sales, which contracted in each of the last three months.

HOPES FOR MORE FED STIMULUS

A weak growth report, flagged by weak data ranging from employment to manufacturing, will raise expectations of a third round of bond purchases, also known as quantitative easing, by the Fed.

The U.S. central bank has already injected $2.3 trillion into the economy through asset purchases and overnight interest rates are near zero, leaving some economists to worry that the Fed does not have enough tools left in its kit.

No major policy announcement is expected at the Fed's two-day meeting next week, but many economists now say the central bank could move when policymakers gather on September 12-13.

"Our view is there is a 70 percent chance that there is QE3 by the September meeting, mostly in the form of mortgage-backed securities, but also long-term Treasuries," said Guy Berger, an economist at RBS in Stamford, Connecticut.

"There is some room for monetary policy to go, but given what they have shown are the tools in their arsenal, it's not a lot."

Last month, the Fed extended a program to re-weight the bonds it already holds toward longer maturities to hold down borrowing costs.

The Commerce Department will release its first snapshot of second-quarter GDP at 8:30 a.m. (1230 GMT).

The economy has been hit by worries of deep government spending cuts and higher taxes scheduled to kick in at the start of 2013, as well as troubles from the debt crisis in Europe.

The biggest factor weighing on the recovery is fear that politicians in Washington would be unable to avoid the so-called fiscal cliff at the turn of the year, economists said.

Recent economic data suggest limited scope for growth to bounce back in the third quarter.

CONSUMERS HUNKER DOWN

Much of the anticipated slowdown in growth in the second quarter will be caused by a softening in consumer spending as Americans eased off on automobile purchases due to tepid job and income growth.

Wall Street and Washington watch consumer spending closely because it accounts for more than two-thirds of U.S. economic activity. In the second quarter, it is expected to have grown at about half the 2.5 percent rate logged in the previous three months.

Autos pushed up consumer spending in the first quarter, helped by pent-up demand after the devastating earthquake and tsunami in Japan last year caused disruptions to auto production and left dealers without models that consumers wanted to buy.

That demand has largely been satisfied.

Labor market weakness, marked by three straight months of job growth at less than 100,000 jobs per month, is causing consumers to hunker down.

"Consumers in general are closely scrutinizing everyday purchases," said Sam Bullard, a senior economist at Wells Fargo Securities in Charlotte, North Carolina. "They are also saving in case of rainy days ahead, given the headwinds the U.S. economy continues to face."

Several U.S. companies have seen demand from American consumers slow. Starbucks Corp began seeing traffic in the United States, its largest market, slow in June, Chief Executive Howard Schultz said.

Tupperware Brands Corp reported weaker-than-expected sales for the second quarter as demand softened in the United States and other markets.

Weak demand is hurting corporate revenues. About 41 percent of the 257 Standard & Poor's 500 companies that have reported results so far for the second quarter have beaten analysts' revenue estimates. That's the lowest since the first quarter of 2009, when just 37 percent of companies beat revenue forecasts, according to Thomson Reuters data.

Economic growth has been below the annualized pace of 2 percent to 2.5 percent that economists say is needed to keep the unemployment rate stable.

With domestic demand weak, businesses probably restocked shelves at a slower pace than in the first quarter. That suggests that inventories could be a modest drag on growth.

DOUBLE WHAMMY FROM OVERSEAS

Slowing global demand, especially in Europe and China, is expected to have restrained export growth in the second quarter.

Government spending is likely to have contracted for a seventh straight quarter, but some economists hope the decline will be slower in defense after two quarters of hefty declines.

No relief is expected from state and local government spending, which has been a drag through much of the recovery.

In contrast, housing - the Achilles heel of the U.S. economy for six years - is expected to show another quarter of strong growth.

Gains are also expected in business spending on equipment and software, even though measures of business confidence softened during the quarter.

Strong gas and oil drilling activity on the back of a boom in on-land exploration during the quarter likely boosted investment in non-residential structures.

"If we can avoid a major financial setback, the recovery will survive," said Robert DiClemente, chief U.S. economist at Citigroup in New York.

"It becomes a more pressing issue at this low rate of growth, what policy can do to keep things going, particularly to keep investor confidence at a level that doesn't cause further damage."

The government will also publish revisions to GDP data going back to 2009.

(Reporting by Lucia Mutikani in Washington, Additional reporting by Caroline Valetkevitch in New York; Editing by William Schomberg and Jan Paschal)

• A Permanent Economic Emergency