US Economic Growth Slows to 2.2% in 2025, Lowest Since 2021

Significant Slowdown in Growth

Newly released government data show that the US real GDP grew by 2.2% in 2025, down from 2.8% in 2024 and marking the weakest annual expansion in four years.

Inflationary Pressures Remain

• The overall domestic purchasing price index rose 2.6% in 2025, up from 2.4% the previous year.
• The Personal Consumption Expenditures (PCE) price index climbed 2.6% year-over-year, matching the 2024 pace.
• Core PCE, excluding food and energy, rose 2.8%, slightly below the 2.9% increase in 2024.

Sharp Decline in Q4

Preliminary figures indicate that annualized GDP growth in the fourth quarter of 2025 came in at 1.4%, a sharp drop from 4.4% in the third quarter. While consumer spending and private investment provided some momentum, declining government spending and weaker exports held back broader economic expansion.