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Updated on April 30.
Real gross domestic product grew by an annual rate of 2% in the first quarter of 2026, according to initial estimates released on April 30 by the Bureau of Economic Analysis.
GDP was negative in the first quarter of 2025, rebounded to 3.8% in the second quarter, rose by 4.4% in the third quarter and finished slower at 0.5% in the final quarter.
Growth in the fourth quarter was largely due to an increase in investment exports, consumer spending and government spending. Imports, which are subtracted from GDP, also increased.
Here’s what NerdWallet’s Senior Economist Elizabeth Renter had to say about the first quarter results.
The economy continued to grow in the first quarter, despite consumer spending decelerating. It’s been the willingness of U.S. consumers to spend despite economic turmoil and uncertainty that has kept the economy humming for the past few years. A slowdown to the extent we see here isn’t cause for alarm, but it is worth noting. If consumers pull back on their spending — out of caution or necessity — it could signal a weaker economy overall.
» MORE: Are we in a recession?
What is GDP?
GDP, or gross domestic product, is the market value — in current dollars — of all goods and services produced within the United States in a given period; Real GDP adjusts that measure for inflation. Changes in GDP are expressed on an annualized basis.
Does recent GDP data signal there is trouble ahead?
First quarter growth in 2026 increased at 2%, faster than the fourth quarter of 2025 (0.5%), but at a much slower pace than both third quarter growth (4.3%) and second quarter growth (3.8%). In the first quarter of 2025, growth was negative.
Negative growth, or contraction, is generally a red flag that there is a slowdown happening in the economy. It shows that consumers and businesses may be spending less. Two consecutive quarters without growth is the traditional definition of a recession.
The first quarter 2025 drop in GDP was largely due to a surge in imported goods as companies and consumers tried to get ahead of President Donald Trump’s tariffs. That said, imports aren’t produced in the U.S. so they aren’t counted in the same way as other GDP factors like household spending, exports and investments. It’s likely that the negative GDP in March reflected a technicality rather than a sign of distress in the economy.
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GDP for the first quarter of 2026
The BEA’s first estimate showed that the U.S. GDP grew faster in the first quarter of 2026 than it did in the fourth quarter of 2025.
In the first quarter of 2026 — covering January, February and March — real GDP went up by 2%, the third estimate shows.
<br>Here’s how the economy grew in recent quarters:
- 0.5% annual rate of growth in Q4 2025.
- 4.4% annual rate of growth in Q3 2025.
- 3.8% annual rate of growth in Q2 2025.
- -0.5% annual rate of growth in Q1 2025
- 2.4% annual rate of growth in Q4 2024.
- 3.1% annual rate of growth in Q3 2024.
- 3% annual rate of growth in Q2 2024.
- 1.6% annual rate of growth in Q1 2024.
The second estimate for GDP in the first quarter of 2026 will be released on May 28.
How did GDP in 2025 compare to recent years?
In 2020, at the beginning of the COVID-19 pandemic, the annual rate of GDP dropped to levels far below even those during the Great Recession, federal data shows. By the end of 2020 and into 2021, GDP rebounded quickly. However, the first two quarters of 2022 showed signs of slowing down before a more robust finish at the end of the year. GDP continued its upward trajectory through 2023, 2024 and 2025.
In 2025, the U.S. Real GDP grew 2.1%, below the 2.8% increase in 2024 and 2.9% increase in 2023. The 2025 increase reflected a rise in consumer spending and investment.
Photo by Justin Sullivan/ Getty Images News via Getty Images
