US Economy Grew 1.4% in Final Quarter of 2025, Missing Expectations

Growth Rate Falls Short of Expectations The U.S.
Department of Commerce has released advance Gross Domestic Product (GDP) data for the October-December period of 2025.
According to the figures, the U.S.
economy grew at an annualized rate of 1.4% in the final quarter of the year.
This rate fell significantly below market expectations of 2.8%, signaling a notable slowdown in economic momentum toward the end of the year.
2025 Annual Performance For the full year of 2025, the national economy expanded by 2.2%.
This figure represents a decline compared to the 2.8% growth performance recorded in 2024.
The year was characterized by significant fluctuations; the economy contracted by 0.6% in the first quarter, followed by growth rates of 3.8% in the second quarter and 4.4% in the third quarter.
Consumer Spending and Inflation Data While increases in consumer spending and investments were the primary drivers of growth in the final quarter, declines in government spending and exports limited the overall expansion.
The Personal Consumption Expenditures (PCE) price index, a key inflation gauge, rose by 2.9% in the fourth quarter.
Core PCE, which excludes volatile food and energy prices, increased by 2.7%, slightly exceeding the 2.6% expectation.
Impact of the Government Shutdown The delay in the release of economic data was attributed to a 43-day federal government shutdown that began on October 1, 2025, due to a budget crisis.
This period caused disruptions in data collection and analysis processes, pushing back the publication schedule for official statistics.