US Economy Expected to Grow 3% in Q4

2026-02-20 08:04:20

The US economy is expected to have grown at an annualized rate of 3.0% in Q4 2025, slowing from 4.4% in the previous quarter. According to the Atlanta Fed’s GDPNow, consumer spending is anticipated to remain solid, supported by health care expenditures and gains in asset markets, though likely moderating to 2.5% from 3.5% in Q3. Investment in non-residential structures and residential construction is expected to stay subdued, while equipment investment may continue to expand, boosted by the ongoing AI boom. Inventories are projected to be largely unchanged in Q4, which would provide a positive contribution to GDP following sharp inventory declines in both Q2 and Q3. Government spending is expected to slow, with state and local expenditures showing moderate growth, while federal outlays are likely to decline following the longest government shutdown on record. On the external front, both exports and imports are forecast to rise modestly, contributing slightly to overall GDP growth.

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