Fourth-Quarter GDP Growth Revised Lower as Consumer Spending Loses Steam

11:28 AM EDT, 03/13/2026 (MT Newswires) -- The US economy expanded in the last quarter of 2025 at a slower pace than initially estimated amid weaker consumer spending and a larger downturn in exports, government data showed Friday.

Real gross domestic product in the world's largest economy grew at a 0.7% annualized rate in the December quarter, according to a second estimate released by the Bureau of Economic Analysis. Wall Street expected growth to match the initial 1.4% estimate, according to a survey compiled by Bloomberg.

The latest estimate still marks the slowest growth in three quarters. In the September quarter, real GDP grew 4.4%. Full-year growth was revised down to 2.1% from the previous estimate of 2.2%.

Growth in consumer spending, as measured by personal consumption expenditures, was revised to 2% from the previous 2.4% estimate, compared with a 3.5% rise in the third quarter.

Spending growth held steady in January as the Federal Reserve's preferred inflation metric accelerated year-over-year, the Bureau of Economic Analysis separately reported Friday. Analysts have cautioned that purchasing power could come under pressure as a result of higher energy prices driven by the Middle East conflict.

Exports shrank 3.3% in the fourth quarter, more than the initially estimated decline of 0.9%, while the decline in imports improved to 1.1% from 1.3%, according to BEA data.

"US aggregate demand wasn't as resilient as we thought at the end of 2025 and economic momentum in 2026 may be on more fragile ground with this oil price shock than is widely appreciated," Scott Anderson, chief US economist at BMO, said in a report.

Oil prices spiked recently following the US-Israel war with Iran amid supply disruptions, particularly through the key Strait of Hormuz.

The latest GDP data, which was delayed due to the government shutdown last year, showed a 0.5-percentage-point downward revision to private investment growth at 3.3%.

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