Real gross domestic product (GDP) in the United States fell at an annual rate of 0.5 percent in the first quarter of 2025, as reported by the U.S. Bureau of Economic Analysis. This follows a 2.4 percent increase in GDP during the last quarter of 2024.
The decrease was mainly due to higher imports and reduced government spending, although these were partially offset by increased investment and consumer spending. The third estimate revised real GDP down by 0.3 percentage points from the second estimate, primarily due to lower consumer spending and exports.
Compared to the fourth quarter of 2024, there was an increase in imports, slower consumer spending growth, and decreased government spending. These factors were somewhat countered by increased investment activity.
Real final sales to private domestic purchasers rose by 1.9 percent in the first quarter, which is a downward revision of 0.6 percentage points from earlier estimates.
From an industry perspective, private goods-producing industries saw a decline of 2.8 percent in real value added, while private services-producing industries declined by 0.3 percent. However, government contributions increased by 2 percent.
Overall gross output grew by 0.6 percent for this period, with private services-producing industries seeing a rise of 1.1 percent but facing declines within both private goods-producing industries and government sectors at rates of 0.6 percent each.
The price index for gross domestic purchases increased to 3.4 percent during this time frame—a slight upward revision from prior figures—while personal consumption expenditures (PCE) also experienced increases.
In terms of income measures, real gross domestic income (GDI) went up by 0.2 percent for Q1 after adjustments were made compared with previous estimations.
Corporate profits dropped $90.6 billion across current production but represented an improvement following revisions that adjusted figures upwardly by $27.5 billion overall.
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