The US economy posted a 2.0% annualized growth rate in the first quarter of 2026, a fourfold jump from the anemic 0.5% expansion recorded in the final three months of 2025.
The advance estimate, released on April 30, initially gave markets something to cheer about. But the Bureau of Economic Analysis followed up on May 28 with a revised second estimate that trimmed the figure down to 1.6%.
What drove the rebound, and what dragged it down
The growth that did materialize came from some familiar sources. Government expenditures turned upward after the longest federal government shutdown on record hammered economic activity in late 2025. Exports climbed. And business investment was the standout performer, surging 10.4% on an annualized basis.
Consumer spending told a different story. Growth in household consumption decelerated from 1.9% in Q4 2025 to 1.6% in the first quarter.
