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Repair Windows errors before they cause bigger problemsFix Now →Scan for outdated or missing drivers - takes under a minuteDriver Scan →The U.S. economy grew at a 1.4% annualized rate in the fourth quarter of 2025, according to the Bureau of Economic Analysis (BEA)’s advance estimate released February 20, 2026. That was a sharp slowdown from Q3’s 4.4% rate—but 1.4% is no longer the latest estimate: BEA’s third estimate, released April 9, put Q4 growth at 0.5%. These are inflation-adjusted quarter-to-quarter growth rates expressed at an annual pace, not growth over the full year.
What the 1.4% GDP figure measured
The 1.4% figure was the advance estimate of real gross domestic product (GDP), which measures the inflation-adjusted value of goods and services produced in the United States. BEA reports quarterly percentage changes at a seasonally adjusted annual rate (SAAR): it takes the quarter-to-quarter pace and expresses it as though that pace continued for a year. So 1.4% was not the amount GDP grew over all of 2025, nor was it the year-over-year change.
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The release was originally scheduled for January 29, 2026, but was rescheduled because of the October–November 2025 federal government shutdown. BEA published the advance estimate on February 20. See the February 20 advance estimate for its figures and methodology.
Why growth slowed from Q3
In its advance estimate, BEA said consumer spending and investment increased in Q4, while government spending and exports fell. Imports also decreased; because imports are subtracted in the GDP calculation, lower imports add to GDP, all else equal. Compared with Q3, the slower overall pace reflected downturns in government spending and exports and slower growth in consumer spending, partly offset by faster investment growth.
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Private domestic demand offered a different signal
BEA’s advance estimate put real final sales to private domestic purchasers up 2.4% at an annual rate. This companion measure combines consumer spending and gross private fixed investment, and excludes government and net exports. It is useful for looking at private domestic demand, but it is not the same measure as headline GDP. BEA later revised it to 1.8% in the third estimate.
How the Q4 GDP estimate changed
GDP estimates are published in successive vintages as more complete source data become available. The activity being measured does not change; the statistical estimate can. For Q4 2025, BEA revised the headline rate downward in both subsequent releases:
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| Estimate vintage | Release date | Real GDP growth, Q4 2025 | What changed |
|---|---|---|---|
| Advance | February 20, 2026 | 1.4% SAAR | Initial estimate |
| Second | March 13, 2026 | 0.7% SAAR | Downward revisions to exports, consumer spending, government spending and investment |
| Third | April 9, 2026 | 0.5% SAAR | Further revision, primarily reflecting lower investment, led by private inventory investment, particularly wholesale trade |
The figures and explanations are from BEA’s second estimate and third estimate. BEA’s GDP data page, whose current release was dated September 30, 2026, says a key-source-data table update on October 1 added Q4 2025 and Q1 2026 entries without changing NIPA data points. Thus, as of October 8, 2026, 0.5% was the latest Q4 estimate located.
What BEA said about the shutdown’s effect
Federal agencies were closed and employees furloughed from October 1 through November 12, 2025. BEA estimated that reduced federal labor services subtracted about 1.0 percentage point from Q4 real GDP growth. That figure covers one identified channel, not the shutdown’s total economic effect: BEA said the full effect could not be quantified separately because it was embedded in the regular source data.
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Furloughed federal employees received back pay. BEA said the shutdown therefore did not reduce current-dollar federal compensation, though it appeared as a temporary increase in prices paid for federal employee compensation. The shutdown also prevented the Bureau of Labor Statistics from collecting October 2025 CPI data. For its GDP-related price indexes, BEA derived seasonally adjusted October indexes using the geometric mean of September and November CPIs, then applied October 2024 seasonal adjustment factors to derive nonseasonally adjusted values. This describes a price-data method; it does not mean the missing CPI observation alone caused the GDP revisions.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Q4 growth is not the same as full-year growth
BEA’s advance estimate put real GDP growth for all of 2025, comparing the 2025 annual level with the 2024 annual level, at 2.2%. The second and third estimates put annual growth at 2.1%. That annual measure has a different comparison period from Q4’s quarterly SAAR, so it should not be read as an alternative version of the 0.5% Q4 figure.
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For readers checking later updates, BEA provides GDP data, interactive tables and historical releases. The release vintage matters when quoting a figure: 1.4% is accurate for the advance estimate, while 0.5% was BEA’s third estimate and the latest Q4 number located by October 8, 2026.
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