U.S. real GDP growth decelerated to an annualized rate of 1.4% in the fourth quarter of 2025, mainly dragged down by the government shutdown, according to the Bureau of Economic Analysis’ initial estimate.
Shutdown’s Direct Hit on Economic Output
The shutdown caused noticeable short-term disruptions in macroeconomic activity. Official data from the BEA underscores how federal operations halted key contributions to overall output during this period.
Outlook Remains Positive
Despite the slowdown, analysts project continued expansion in the 2.0% to 2.5% range. Supply-side factors continue to propel economic momentum forward.
Investors should watch for upcoming BEA revisions and government policy actions, which could provide clearer signals on the economy’s trajectory.
