The U.S. Bureau of Economic Analysis just came out with the quarter-over-quarter report for the first three months of the year. This report gives us key information regarding the economic performance of the U.S. in 2025 so far, and will serve as one of the most important benchmarks for the Fed to assess the next interest rate decision in the U.S.
With recession fears looming and the Atlanta Fed’s GDPNow prediction sitting at -2.7%, all eyes are on these numbers to determine whether growth really decreased, stalled, or if there’s a chance for recovery.
A Grim Reality: Q1 GDP Prints Negative at -0.03%
The numbers are in, and the official Q1 GDP quarter-over-quarter reading has come out worse than expected—printing at -0.3%. This marks a significant downturn from Investing.com’s forecast of 0.2% growth and the previous quarter’s 2.4% expansion.
Moreover, this is the worst economic performance by the U.S. in a first quarter since the post-pandemic year of 2022.
Market & Policy Impact
With negative GDP growth officially confirmed, financial markets are now bracing for volatility. Investors will be closely watching how stocks, bonds, and crypto react to the data in the coming hours.
Meanwhile, pressure mounts on the Federal Reserve, as officials must decide whether aggressive rate cuts are needed to stimulate growth—or if inflation risks still outweigh recession fears.
In all likelihood, Fed Chairman Jerome Powell will refrain from drastic interest rate cuts, despite the executive branch’s pressure for the Central Bank to do so.
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