The economy limped to the finish line to end 2025

The U.S. economy grew at an annual rate of 0.7% in the fourth quarter of 2025, according to a revised estimate from the Bureau of Economic Analysis — a downward revision of 0.7 percentage point from the agency's earlier reading.

The revised figure came in well below the consensus forecast of 1.5% and marks a steep deceleration from the 4.4% pace recorded in the third quarter, according to CNBC. Growth for the full year 2025 came in at 2.1%, down 0.1 percentage point from the prior estimate and below the 2.8% pace recorded in 2024.

The BEA said the revision reflected downward adjustments to exports, consumer spending, government spending, and investment. Imports fell by less than previously estimated, which also weighed on the headline number since a smaller import decline provides less of a mathematical boost to GDP. The downward revision to consumer spending was driven largely by health care services, based on new Census Bureau data. The revision to exports reflected updated figures for intellectual property charges.

The second estimate had been delayed from its originally scheduled Feb. 26 release date due to last fall's government shutdown.

On inflation, the BEA's fourth-quarter price index for gross domestic purchases rose 3.8%, revised up slightly from the previous estimate. The personal consumption expenditures price index — the Federal Reserve's preferred inflation gauge — increased 2.9% in the quarter, unchanged from the prior estimate. Core PCE, which strips out food and energy, rose 2.7%, also unchanged.

The GDP report covers a period that predates two significant economic events: the Supreme Court decision that voided a portion of President Donald Trump's tariffs and the early March U.S.-Israel war against Iran, which sent energy prices higher. The data therefore reflect neither the relief from the tariff ruling nor the inflationary pressure from the oil shock that followed.