Q1 2026 GDP Revised Up to 2.1% as Consumer Spending Slows

The U.S. economy grew at a stronger pace than initially estimated in the first quarter of 2026, though the upgrade was driven by technical factors that masked a significant slowdown in consumer spending. The Commerce Department's final estimate, released Thursday, showed gross domestic product expanded at an annualized rate of 2.1% from January through March, a notable upward revision from the previously reported 1.6% pace. The economy had grown at a 0.5% rate in the final quarter of 2025.

The primary reason for the revision was a smaller-than-previously-estimated surge in imports, particularly of consumer and capital goods. Because imports subtract from GDP calculations, the lower import levels mechanically boosted the headline growth figure. This technical adjustment offset a sharp downgrade to consumer spending, which accounts for more than two-thirds of U.S. economic activity. Growth in consumer spending was revised down to just a 0.5% annualized rate from the prior 1.4% estimate, reflecting weaker outlays on services including financial services, insurance, and international travel. This represents one of the slowest rates of consumer spending growth in recent years.