❓WHAT HAPPENED: The Federal Reserve Bank of Atlanta has updated its gross domestic product (GDP) estimate for the U.S. economy for the 4th Quarter (Q4) of 2025 to an astounding 5.3 percent.
👤WHO WAS INVOLVED: The Federal Reserve Bank of Atlanta, American businesses, economists, and the Trump administration.
📍WHEN & WHERE: The estimate was released earlier in January, with an update scheduled for Wednesday, January 22. The initial 4th Quarter GDP numbers will be released on February 20.
🎯IMPACT: While jobs data continues to suggest a softening in the job market, overall economic data shows the American economy continues to strengthen.
The Federal Reserve Bank of Atlanta, which maintains the central bank’s GDP Now tracking system, estimates that the 4th Quarter gross domestic product (GDP) in the entire United States expanded by 5.3 percent. This would mark the highest jump in GDP since the 4th Quarter of 2021, when the economy expanded by seven percent—though this was exceptional, being the final significant jump in growth stemming from the lifting of lockdowns during the COVID-19 pandemic.
Before that, a brief surge following a sharp Q1 contraction occurred in 2014, and before that, the last growth rate above 5% was in 2003.
In the Second Quarter of 2025, the economy under President Donald J. Trump grew at three percent. At the same time, the initial Third Quarter number shows the economy grew by 4.3 percent. The robust expansion of the economy has been a key goal of the Trump administration, as high growth levels not only signal increasing economic productivity but also rebalance the United States’s debt-to-GDP ratio.
Notably, the Atlanta Fed’s data suggests almost all of the economic growth in the last quarter will have come from the private sector, allaying ongoing concerns about an economic contraction.
While jobs data continues to suggest a softening in the job market, overall economic data shows the American economy continuing to strengthen. With inflation numbers having fallen to just about the Federal Reserve‘s two percent target, it is likely the central bank will face continued pressure to slash interest rates for the foreseeable future.
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