U.S. Q4 2025 GDP Revised to 0.5% on Shutdown Effects

The U.S. economy expanded at a modest 0.5 percent annualized rate in the fourth quarter of 2025, according to the Commerce Department's final estimate released Thursday, reflecting a slowdown largely attributed to the 43-day government shutdown the previous fall.

The revised figure marked a downgrade from the department's earlier projection of 0.7 percent growth for the October-through-December period. Gross domestic product, which measures the total output of goods and services, decelerated after stronger performances in prior quarters, including 4.4 percent growth from July through September and 3.8 percent from April through June. The shutdown significantly curtailed federal government spending and investment, which declined at a 16.6 percent annual rate and subtracted 1.16 percentage points from overall GDP growth.

Consumer spending, a key driver of economic activity, rose at a 1.9 percent pace during the quarter, a slight decrease from the initial estimate and well below the 3.5 percent increase recorded in the second quarter. For the full year of 2025, the economy grew by 2.1 percent, a deceleration from 2.8 percent in 2024 and 2.9 percent in 2023.