U.S. GDP Revised Up to 4.4% in Q3 on Strong Consumer Spending
The U.S. economy grew at a 4.4% annualized rate in Q3, led by consumer services, exports, and AI-related investment amid weak hiring and rising tariffs.
Overview
The Commerce Department revised third-quarter GDP to a 4.4% annualized pace, the fastest growth since Q3 2023, driven primarily by stronger consumer spending.
Consumer spending rose 3.5%, with services like healthcare up 3.6% and durable goods up only 1.6%, reflecting a services-led consumption pattern.
Upgrades to exports and business investment — including AI-related equipment spending — and a narrower trade deficit also contributed to the upward revision.
Labor markets show weakness: employers have added only about 28,000 jobs monthly since March, yet unemployment remains low at 4.4%.
Economists warn of a K-shaped recovery: wealthier households and large firms drive growth while lower-income families face stagnant wages and higher living costs.
Analysis
Center-leaning sources present headline GDP growth but qualify it with caution: they use evaluative language ("despite uncertainty," "uneasy situation"), emphasize inequality via a "K-shaped economy," highlight an expert's "jobless boom" quote, and omit contrasting official or business perspectives—producing a skeptical frame that undercuts the growth narrative.
Sources (4)
FAQ
The initial estimate for Q3 2025 GDP growth was 4.3%, which was revised upward to 4.4% in the final estimate by the Bureau of Economic Analysis.
The upward revision was driven by stronger consumer spending (especially services), higher exports, business investment including AI-related equipment, and a narrower trade deficit.
Consumer spending rose 3.5% annualized, with services like healthcare up 3.6% and durable goods up 1.6%, indicating a services-led pattern.
Employers added only about 28,000 jobs monthly since March, though unemployment remained low at 4.4%.
It refers to a recovery where wealthier households and large firms drive growth, while lower-income families face stagnant wages and higher living costs.
History
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