US GDP fell by 0.5% in the first quarter - stronger than previously estimated
Photo: EPA / CJ GUNTHER

The US real GDP for the first quarter of 2025 (January-March) decreased by 0.5% year-on-year, according to a new estimate by the US Bureau of Economic Analysis. Previously, it reported a 0.2% drop in GDP.

For comparison, in the fourth quarter of 2024, real GDP grew by 2.4%.

The main reasons for the decline in GDP in the United States were an increase in imports and a reduction in government spending, which were partially offset by an increase in investment and consumer spending.

The last time the US economy showed a negative result was in the second quarter of 2022.

In the United States, the annualized calculation is used for quarterly GDP figures. This means that the current rate of change is recalculated as if the economy had continued to change at the same rate for the entire year. That is, the actual decline for the quarter was smaller, but the US traditionally uses the annualized figure.

  • In Europe, quarterly GDP growth in the eurozone, unlike the United States, was the highest since 2022. This was driven by exceptional growth in Ireland and higher-than-originally-reported figures in Germany.