GDP and the Economy

Advance Estimates for the First Quarter of 2025

May 7, 2025

Real gross domestic product (GDP) decreased at an annual rate of 0.3 percent in the first quarter of 2025, according to the “advance” estimate of the National Income and Product Accounts (chart 1 and table 1).1 In the fourth quarter of 2024, real GDP increased 2.4 percent.

Chart 1. Real GDP: Percent Change From Preceding Quarter

[View larger chart]
Chart 2. Real GDP: Contributions to the Percent Change in 2025:Q1

[View larger chart]

The decrease in first-quarter real GDP primarily reflected an increase in imports (which are a subtraction in the calculation of GDP) and a decrease in federal government spending that were partly offset by increases in inventory investment, nonresidential fixed investment, and consumer spending (chart 2 and table 1).2

  • Imports primarily reflected U.S. Census Bureau (Census)-U.S. Bureau of Economic Analysis (BEA) U.S. international trade in goods and services data as well as data from the Census Advance Economic Indicators Report for March.
    • Within imports, the increase primarily reflected an increase in imported goods, led by consumer goods, except food and automotive (mainly medicinal, dental, and pharmaceutical preparations, including vitamins), and by capital goods, except automotive (mainly computers, peripherals, and parts).
    • Within imports of industrial supplies and materials in the National Economic Accounts (NEAs), BEA identified and removed an increase in imports of silver bars in the first quarter. Similar to nonmonetary gold, silver can be used for two purposes: for industrial use (as an input into the production of goods and services) and for investment (as a store of wealth and a hedge against inflation). BEA's NEAs do not treat transactions in valuables, such as nonmonetary gold and silver, as investments, and therefore, purchases of metals as a form of investment are not included in consumer spending, gross private domestic investment, or government spending. For more information, refer to “How are exports and imports of nonmonetary gold treated in BEA's National Economic Accounts?”.
  • The decrease in federal government was led by defense consumption expenditures.
  • The increase in inventory investment was led by wholesale trade, notably, drugs and sundries. The estimates were based primarily on Census inventory book value data and a BEA adjustment in March to account for a notable increase in imports.
  • Within nonresidential fixed investment, the increase was led by equipment. Within equipment, the increase was led by information processing and related equipment (mainly computers and peripheral equipment and communication equipment).
  • The increase in consumer spending reflected increases in both services and goods. Within services, increases were widespread, led by spending on health care and housing and utilities. Within goods, an increase in nondurable goods was partly offset by a decrease in durable goods.

Compared to the fourth quarter, the downturn in real GDP in the first quarter reflected an upturn in imports, a deceleration in consumer spending, and a downturn in federal government spending that were partly offset by upturns in inventory investment and nonresidential fixed investment.

Real final sales to private domestic purchasers, the sum of consumer spending and gross private fixed investment, increased 3.0 percent in the first quarter, compared with an increase of 2.9 percent in the fourth quarter.

Table 1. Real GDP and Related Measures
[Seasonally adjusted at annual rates]
Line Series Share of current-dollar GDP
(percent)		 Change from preceding period
(percent)		 Contribution to percent change in real GDP
(percentage points)
2025 2024 2025 2024 2025
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
1 GDP1 100.0 3.0 3.1 2.4 −0.3 3.0 3.1 2.4 −0.3
2 Personal consumption expenditures 68.5 2.8 3.7 4.0 1.8 1.90 2.48 2.70 1.21
3 Goods 21.3 3.0 5.6 6.2 0.5 0.63 1.18 1.30 0.11
4 Durable goods 7.4 5.5 7.6 12.4 −3.4 0.40 0.54 0.87 −0.26
5 Nondurable goods 13.9 1.7 4.6 3.1 2.7 0.23 0.63 0.42 0.37
6 Services 47.1 2.7 2.8 3.0 2.4 1.27 1.31 1.41 1.10
7 Gross private domestic investment 18.6 8.3 0.8 −5.6 21.9 1.47 0.16 −1.03 3.60
8 Fixed investment 18.0 2.3 2.1 −1.1 7.8 0.42 0.38 −0.20 1.34
9 Nonresidential 13.9 3.9 4.0 −3.0 9.8 0.53 0.55 −0.41 1.29
10 Structures 3.1 0.2 −5.0 2.9 0.4 0.01 −0.16 0.09 0.01
11 Equipment 5.3 9.8 10.8 −8.7 22.5 0.49 0.54 −0.47 1.06
12 Intellectual property products 5.5 0.7 3.1 −0.5 4.1 0.04 0.17 −0.03 0.22
13 Residential 4.1 −2.8 −4.3 5.5 1.3 −0.11 −0.18 0.22 0.05
14 Change in private inventories 0.6 --- --- --- --- 1.05 −0.22 −0.84 2.25
15 Net exports of goods and services −4.2 --- --- --- --- −0.90 −0.43 0.26 −4.83
16 Exports 10.9 1.0 9.6 −0.2 1.8 0.12 1.01 −0.01 0.19
17 Goods 7.0 0.9 10.3 −4.6 3.2 0.07 0.70 −0.33 0.22
18 Services 3.9 1.2 8.4 8.5 −0.7 0.05 0.31 0.32 −0.03
19 Imports 15.1 7.6 10.7 −1.9 41.3 −1.01 −1.44 0.27 −5.03
20 Goods 12.2 8.4 10.7 −4.9 50.9 −0.90 −1.14 0.57 −4.79
21 Services 2.9 4.3 11.0 10.9 8.6 −0.12 −0.29 −0.30 −0.24
22 Government consumption expenditures and gross investment 17.1 3.1 5.1 3.1 −1.4 0.52 0.86 0.52 −0.25
23 Federal 6.4 4.3 8.9 4.0 −5.1 0.27 0.55 0.25 −0.33
24 National defense 3.7 6.4 13.9 4.8 −8.0 0.23 0.48 0.18 −0.31
25 Nondefense 2.8 1.5 2.6 2.9 −1.0 0.04 0.07 0.08 −0.03
26 State and local 10.7 2.3 2.9 2.5 0.8 0.25 0.31 0.27 0.08
Addenda:
27 GDI2 --- 2.0 1.4 4.5 --- --- --- --- ---
28 Average of GDP and GDI --- 2.5 2.2 3.5 --- --- --- --- ---
29 Final sales of domestic product --- 1.9 3.3 3.3 −2.5 --- --- --- ---
30 Final sales to private domestic purchasers --- 2.7 3.4 2.9 3.0 --- --- --- ---
31 Goods 29.6 5.2 4.7 0.7 −3.0 1.56 1.41 0.23 −0.91
32 Services 61.6 2.4 3.2 3.0 1.0 1.48 1.92 1.81 0.60
33 Structures 8.8 −0.6 −2.9 4.7 0.4 −0.05 −0.26 0.41 0.03
GDI
Gross domestic income
GDP
Gross domestic product
  1. The GDP estimates under the contribution columns are also percent changes.
  2. GDI is deflated by the implicit price deflator for GDP.

Note. Percent changes are from National Income and Product Accounts (NIPA) tables 1.1.1 and 1.2.1, contributions are from NIPA tables 1.1.2 and 1.2.2, and shares are from NIPA table 1.1.10 or are calculated from NIPA table 1.2.5.

U.S. Bureau of Economic Analysis

BEA's featured measure of inflation for the U.S. economy, the price index for gross domestic purchases (goods and services purchased by U.S. residents), increased 3.4 percent in the first quarter after increasing 2.2 percent in the fourth quarter (chart 3 and table 2).

Within gross domestic purchases, food prices increased 2.9 percent in the first quarter after increasing 2.8 percent in the fourth quarter. Prices for energy goods and services increased 8.5 percent after decreasing 4.2 percent. Excluding food and energy, gross domestic purchases prices increased 3.3 percent after increasing 2.3 percent.

The price index for personal consumption expenditures (PCE) increased 3.6 percent in the first quarter after increasing 2.4 percent in the fourth quarter. The increase in PCE prices reflected an increase in prices for both services and goods.

  • Within services, increases were widespread. The leading contributors were housing and utilities (mainly housing), financial services and insurance (mainly banking and “other financial services”), and recreation services (led by membership clubs, sports centers, parks, theaters, and museums).
  • Within goods, the leading contributors to the increase were “other nondurable goods” (led by pharmaceutical and “other medical products”) and food and beverages.

Excluding food and energy, the “core” PCE price index increased 3.5 percent in the first quarter, following an increase of 2.6 percent in the fourth quarter.

Chart 3. Prices for Gross Domestic Purchases

[View larger chart]
Table 2. Prices for Gross Domestic Purchases
[Percent change at annual rates; based on seasonally adjusted index numbers (2017=100)]
Line Series Change from preceding period
(percent)		 Contribution to percent change in gross domestic purchases prices
(percentage points)
2024 2025 2024 2025
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
1 Gross domestic purchases1 2.4 1.9 2.2 3.4 2.4 1.9 2.2 3.4
2 Personal consumption expenditures 2.5 1.5 2.4 3.6 1.67 1.02 1.57 2.37
3 Goods 0.7 −1.6 −0.4 2.2 0.15 −0.33 −0.07 0.47
4 Durable goods −2.6 −2.4 −0.1 0.9 −0.18 −0.17 0.00 0.07
5 Nondurable goods 2.5 −1.2 −0.5 3.0 0.33 −0.16 −0.07 0.40
6 Services 3.4 3.0 3.7 4.2 1.52 1.35 1.64 1.90
7 Gross private domestic investment 2.5 3.0 1.6 1.2 0.44 0.53 0.28 0.21
8 Fixed investment 2.6 3.2 1.6 1.2 0.45 0.55 0.27 0.22
9 Nonresidential 2.3 3.1 1.5 0.4 0.31 0.42 0.20 0.06
10 Structures 0.3 1.9 −0.6 1.1 0.01 0.06 −0.02 0.03
11 Equipment 1.7 2.5 1.0 0.6 0.08 0.12 0.05 0.03
12 Intellectual property products 4.0 4.4 3.2 0.0 0.21 0.23 0.17 0.00
13 Residential 3.5 3.5 1.9 3.9 0.14 0.13 0.07 0.15
14 Change in private inventories --- --- --- --- −0.01 −0.02 0.00 −0.01
15 Government consumption expenditures and gross investment 2.1 2.4 2.1 4.7 0.34 0.40 0.35 0.78
16 Federal 2.8 2.4 2.7 5.5 0.17 0.15 0.17 0.34
17 National defense 2.7 1.9 2.3 4.7 0.09 0.07 0.08 0.17
18 Nondefense 3.0 3.2 3.1 6.5 0.08 0.08 0.08 0.17
19 State and local 1.6 2.4 1.8 4.3 0.17 0.25 0.19 0.44
  Addenda:
  Gross domestic purchases:                
20 Food −0.5 1.3 2.8 2.9 −0.02 0.07 0.14 0.14
21 Energy goods and services 2.5 −12.6 −4.2 8.5 0.06 −0.34 −0.11 0.21
22 Excluding food and energy 2.6 2.4 2.3 3.3 2.41 2.22 2.17 3.01
  Personal consumption expenditures:                
23 Food and beverages purchased for off-premises consumption −0.4 1.6 2.7 2.9 --- --- --- ---
24 Energy goods and services 2.4 −12.4 −4.2 8.4 --- --- --- ---
25 Excluding food and energy 2.8 2.2 2.6 3.5 --- --- --- ---
26 Gross domestic product 2.5 1.9 2.3 3.7 --- --- --- ---
27 Exports of goods and services 2.7 −0.9 0.2 5.2 --- --- --- ---
28 Imports of goods and services 2.1 −0.2 −0.3 2.1 --- --- --- ---
  1. The estimated prices for gross domestic purchases under the contribution columns are also percent changes.

Note. Most percent changes are from National Income and Product Accounts (NIPA) table 1.6.7; percent changes for personal consumption expenditures (PCE) for food and energy goods and services and for PCE excluding food and energy are from NIPA table 2.3.7. Contributions are from NIPA table 1.6.8. Gross domestic product, export, and import prices are from NIPA table 1.1.7.

Measured in current dollars, personal income increased $398.7 billion in the first quarter, compared to an increase of $281.7 billion in the fourth quarter (table 3). The increase primarily reflected increases in compensation (led by private wages and salaries) and personal current transfer receipts.

  • The increase in compensation was led by private wages and salaries, based on data from the U.S. Bureau of Labor Statistics (BLS) Current Employment Statistics program.
    • In the first quarter, wages and salaries in services-producing industries increased $91.9 billion. Wages and salaries in goods-producing industries increased $24.4 billion.
    • Some federal government employees opted to accept a Deferred Resignation Program (DRP) offer. Federal workers who accepted the DRP offer are counted as employed in the BLS source data. Because these employees will continue to receive compensation until they officially separate from the federal government, BEA made no adjustment to personal income as a result of this program. For additional information, refer to “How are reductions to the federal workforce reflected in GDP?”.
  • The increase in personal current transfer receipts was led by Social Security benefits, reflecting a January cost-of-living adjustment based on data from the Social Security Administration.

Personal current taxes increased $56.7 billion in the first quarter after increasing $51.2 billion in the fourth quarter.

Current-dollar disposable personal income (DPI)—personal income less personal current taxes—increased $342.0 billion in the first quarter after increasing $230.4 billion in the fourth quarter. Real DPI (chart 4), which is deflated by the implicit price deflator for consumer spending, increased 2.7 percent after increasing 1.9 percent. Personal outlays—the sum of PCE, personal interest payments, and personal current transfer payments—increased $261.2 billion after increasing $316.6 billion.

The personal saving rate (chart 5)—personal saving as a percentage of DPI—was 4.0 percent in the first quarter, compared with 3.7 percent in the fourth quarter.

Table 3. Personal Income and Its Disposition
[Billions of dollars; quarterly estimates are seasonally adjusted at annual rates]
Line Series Level Change from preceding period
2024 2025 2024 2025
Q4 Q1 Q2 Q3 Q4 Q1
1 Personal income 24,998.4 25,397.2 229.8 142.7 281.7 398.7
2 Compensation of employees 15,224.0 15,406.3 121.9 90.4 187.9 182.3
3 Wages and salaries 12,559.3 12,701.5 92.1 61.0 155.2 142.1
4 Private industries 10,665.0 10,781.3 65.0 37.8 127.5 116.3
5 Goods-producing industries 1,938.0 1,962.4 −17.6 9.3 18.0 24.4
6 Manufacturing 1,119.4 1,139.1 −16.0 5.0 7.2 19.7
7 Services-producing industries 8,727.0 8,818.9 82.6 28.5 109.4 91.9
8 Trade, transportation, and utilities 1,885.7 1,903.9 11.9 −2.6 17.8 18.2
9 Other services-producing industries 6,841.3 6,915.0 70.7 31.1 91.6 73.7
10 Government 1,894.4 1,920.2 27.1 23.3 27.8 25.8
11 Supplements to wages and salaries 2,664.7 2,704.9 29.8 29.4 32.7 40.2
12 Proprietors' income with IVA and CCAdj 2,035.5 2,060.5 30.2 11.2 22.0 25.0
13 Farm 54.7 57.7 2.5 5.4 8.3 3.0
14 Nonfarm 1,980.8 2,002.7 27.6 5.8 13.7 22.0
15 Rental income of persons with CCAdj 1,072.2 1,093.1 7.3 2.3 16.6 20.8
16 Personal income receipts on assets 3,958.3 4,015.2 11.3 −11.4 19.5 56.9
17 Personal interest income 1,975.1 1,997.6 15.2 0.1 8.7 22.5
18 Personal dividend income 1,983.3 2,017.6 −4.0 −11.6 10.8 34.4
19 Personal current transfer receipts 4,626.6 4,768.6 66.2 58.1 56.2 141.9
20 Government social benefits to persons 4,491.1 4,620.5 65.5 57.7 53.3 129.4
21 Social security 1,467.9 1,511.9 13.2 13.4 14.8 44.0
22 Medicare 1,118.5 1,150.3 17.9 23.1 28.3 31.8
23 Medicaid 944.8 966.6 19.8 7.8 12.3 21.9
24 Unemployment insurance 36.1 35.8 0.0 0.7 0.4 −0.3
25 Veterans' benefits 226.3 230.9 5.0 4.8 4.7 4.6
26 Other 697.6 725.1 9.5 7.9 −7.2 27.5
27 Other current transfer receipts, from business (net) 135.5 148.0 0.8 0.3 2.9 12.5
28 Less: Contributions for government social insurance 1,918.2 1,946.4 7.0 7.8 20.6 28.2
29 Less: Personal current taxes 3,105.4 3,162.1 39.8 48.8 51.2 56.7
30 Equals: DPI 21,893.0 22,235.0 190.0 93.9 230.4 342.0
31 Less: Personal outlays 21,090.2 21,351.4 277.0 266.1 316.6 261.2
32 Personal consumption expenditures 20,255.5 20,526.3 257.9 255.7 317.0 270.8
33 Personal interest payments1 558.2 559.4 17.4 8.8 −2.3 1.2
34 Personal current transfer payments 276.5 265.7 1.7 1.6 1.8 −10.8
35 Equals: Personal saving 802.8 883.6 −87.0 −172.1 −86.1 80.8
36 Personal saving as a percentage of DPI 3.7 4.0 --- --- --- ---
CCAdj
Capital consumption adjustment
DPI
Disposable personal income
IVA
Inventory valuation adjustment
  1. Consists of nonmortgage interest paid by households. Note that mortgage interest paid by households is an expense item in the calculation of rental income of persons.

Note. Dollar levels and percent changes are from National Income and Product Accounts tables 2.1 and 2.2B.

Chart 4. Real Disposable Personal Income

[View larger chart]
Chart 5. Personal Saving Rate

[View larger chart]

 

  1. “Real” estimates are in chained (2017) dollars, and price indexes are chain-type measures. Each GDP estimate for a quarter (advance, second, and third) incorporates increasingly comprehensive and improved source data; for more information, see Dennis J. Fixler, Danit Kanal, and Pao-Lin Tien, “The Revisions to GDP, GDI, and Their Major Components,” Survey of Current Business 98 (January 2018). Quarterly estimates are expressed at seasonally adjusted annual rates, which reflect a rate of activity for a quarter as if it were maintained for a year.
  2. In this article, “consumer spending” refers to “personal consumption expenditures,” “inventory investment” refers to “change in private inventories,” and “government spending” refers to “government consumption expenditures and gross investment.”