US Q4 2025 GDP Revised Down to 0.5%
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- Bureau of Economic Analysis revised Q4 2025 real GDP growth to 0.5% in its third estimate, down 0.2 percentage points from the 0.7% second estimate, primarily reflecting a downward revision to investment.
- The 0.5% figure represents a sharp deceleration from Q3 2025's 4.4% growth rate; the report was rescheduled from March 27, 2026 due to the October–November 2025 government shutdown.
- GDP contributors included increases in consumer spending and investment, partly offset by decreases in government spending and exports, with imports also declining.
- By industry, private services-producing industries rose 2.3%, while government fell 7.8% and private goods-producing industries fell 1.8%; wholesale trade, information, and health care were the leading growth contributors.
- Corporate profits from current production jumped $246.9 billion in Q4, up from a $175.6 billion increase in Q3.
- State-level GDP grew in 35 states, ranging from +3.8% in North Dakota (led by agriculture) to −8.3% in the District of Columbia (led by federal civilian spending declines).
- Inflation measures held steady: the PCE price index rose 2.9% and core PCE rose 2.7%, both unchanged from prior estimates, while real GDI grew 2.6%.
Why it matters: The collapse from 4.4% to 0.5% growth in a single quarter signals the US economy lost nearly all momentum exiting 2025, and the 0.2pp downward revision — driven by weaker investment — means earlier estimates overstated the year's finish. The government sector's 7.8% decline and DC's 8.3% GDP contraction point to fiscal drag as the dominant force behind the slowdown, a story that will shape 2026 growth debates and Federal Reserve rate-cut expectations.
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