US Q4 2025 GDP growth up 1.4 pct, well below estimate

WASHINGTON -- US GDP increased at a 1.4 percent annual rate in the fourth quarter of 2025, well below the 2.5 percent growth market analysts had projected, according to data released Friday by the US Bureau of Economic Analysis.

The growth represents a marked deceleration from the 4.4 percent expansion seen in the third quarter, as a federal government shutdown and cooling consumer demand weighed on activity.

The data release was delayed by a month due to the federal government shutdown, which economists estimate stripped between 0.25 and 1.5 percentage points from the quarterly growth. While experts generally expect the economy to recoup these losses in the current period, the report highlighted a notable decline in federal spending and a pullback in goods purchases.

Consumer spending, the primary engine of the US economy, slowed in the fourth quarter to a 2.4 percent annual rate, its weakest pace since early 2025. The data underscored a growing divide across income brackets, with lower-income households increasingly burdened by rising debt, a cooling labor market, and the cumulative impact of several years of high inflation.

On the price front, the Federal Reserve's preferred inflation metric, the personal consumption expenditures price index, rose 2.9 percent in the 12 months through December.

The economic data triggered an immediate reaction from US President Donald Trump, who criticized Democrats for the shutdown on his social media, claiming it cost the nation at least two points in GDP growth. He also reiterated his long-standing grievances against Federal Reserve Chairman Jerome Powell, demanding lower interest rates and labeling the central bank's cautious approach as "too late."