U.S. economic growth slowed sharply toward the end of 2025. Gross domestic product expanded at an annualized rate of 0.7% in the fourth quarter of 2025, according to the second estimate released Friday by the Bureau of Economic Analysis.
The reading was significantly revised down from the initial 1.4% estimate and marked a sharp deceleration from the 4.4% growth pace recorded in the third quarter.
The downward revision from the advance estimate was driven by weaker exports, softer consumer spending, lower government outlays and reduced investment, while imports declined less than previously estimated.
Compared with the third quarter, the slowdown in real GDP growth primarily reflected declines in government spending and exports, alongside a cooling in consumer spending. These factors were partially offset by stronger investment, which accelerated during the quarter.
Core PCE Inflation Rises …
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