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U.S. Economy Grew 4.3% in Q3, Beating Forecasts on Strong Spending and Trade

The delayed BEA estimate highlights robust summer output, with data gaps and a softer jobs picture leaving its durability in doubt.

Shoppers carry bags in Los Angeles on August 28.
Image
A shopper in Philadelphia on Dec. 10, 2025.
Spending on artificial intelligence and the infrastructure needed to power it has kept economic growth humming.

Overview

  • Real GDP rose at a 4.3% annualized pace in Q3 2025, versus roughly 3.2% expected, the strongest in two years.
  • Consumer spending accelerated to a 3.5% rate as exports rebounded and imports fell, while government outlays added to growth and investment declined.
  • The release was pushed back by a 43‑day federal shutdown, compressing the usual revision process; updated figures are due in January 2026.
  • Inflation in the report ran hotter, with PCE at about 2.8% and core PCE near 2.9%, complicating the Federal Reserve’s path after recent rate cuts.
  • The labor market has cooled with unemployment near 4.6% in November, and the CBO estimates the shutdown will subtract roughly 1–2 percentage points from Q4 growth.