Episode 59: U.S. economic data points to a cooling expansion marked by slower GDP growth, a widening trade gap and consumers growing more cautious.
- S. GDP growth slowed to 1.4% in 4th quarter, a pace below the 4.4% growth in 3rd quarter. Calendar-year 2025 GDP growth was 2.2%, down from 2.8% in 2024.
- Consumer spending and investment added to GDP growth, while government spending and exports weakened.
- The December trade deficit widened to $70.3 billion, up 32.6% from November, as imports rose and exports slipped.
- For 2025, the trade deficit totaled $901.5 billion. Exports grew 6.2% and imports grew 4.8%, resulting in a drag on GDP.
- The Conference Board’s Leading Economic Index fell 0.2% in December, its fifth straight monthly decline.
- December PCE (Personal Consumption Expenditures) inflation rose 0.4% month‑over‑month and 2.9% year‑over‑
- Housing starts rose 6.2% in December to a 1.404 million annual rate. Permits reached 1.448 million.
- New home sales in December were down 1.7% from November but up 3.8% year‑over‑year; median prices fell 2% year-over-year to $414,400 in December.
- In February 2026, the Consumer Sentiment Index rose to 56.6 but remained 12.5% below the year-earlier level.
- Consumer Confidence Index reached 91.2 in February 2026. The expectations component was weak at 72, below the recession‑warning threshold of 80 for 13 straight months.
For more information on the state of the U.S. Economy, including forecasts, watch all the episodes of the Economy Express series.
