20.02.202613:33:15UTC+00US GDP Growth Well Below Forecasts

The US economy grew at an annualized rate of 1.4% in Q4 2025, its weakest pace since Q1 2025, down sharply from 4.4% in Q3 and well below the 3% consensus forecast, according to the advance estimate.

Consumer spending cooled to a 2.4% increase from 3.5% in the previous quarter, as a 0.1% decline in goods purchases offset some of the strength in services, which rose 3.4%. Net trade was a drag as well: exports fell 0.9% after a 9.6% surge in Q3, while imports also declined, though more moderately (-1.3% vs -4.4%).

Government spending and investment contracted sharply, dropping 5.1% after a 2.2% increase in Q3 and subtracting 0.9 percentage point from overall growth, largely reflecting the impact of the government shutdown.

By contrast, fixed investment strengthened, accelerating to 2.6% from 0.8%. The pickup was led by robust gains in intellectual property products (7.4% vs 5.6%) and equipment (3.2% vs 5.2%), alongside a smaller decline in nonresidential structures (-2.4% vs -5.0%). The downturn in residential investment also moderated (-1.5% vs -7.1%).

For full-year 2025, the US economy expanded 2.2%, down from 2.8% in 2024, with growth supported primarily by increases in consumer spending and investment.