Economic growth accelerates in the first quarter of 2026

GDP reading: The United States' GDP grew 2.0% on a seasonally adjusted quarter-on-quarter annualized (SAAR) basis in Q1, following 0.5% growth in the prior quarter but slightly below market expectations. A bounce-back in government spending following the end of Q4’s shutdown plus buoyant tech investment were key supportive drivers, while net exports remained a drag.

Drivers: Compared with the previous quarter's data, readings in Q1 improved for government consumption (+4.4% in seasonally adjusted quarter-on-quarter annualized (SAAR) terms vs -5.6% in Q4), fixed investment (+6.2% vs +1.5% in Q4), exports of goods and services (+12.9% vs -3.2% in Q4) and imports of goods and services (+21.4% vs -1.0% in Q4). In contrast, the reading for private consumption worsened in Q1 (+1.6% vs +1.9% in Q4).

Panelist insight: Digging deeper into the latest data, ING’s James Knightley said: “In terms of business capex, we see the continuing theme of growth being driven by tech/AI. Software and computing investment rose 24% YoY while all other business capex has contracted for the sixth consecutive quarter. This looks unlikely to change with the latest durable goods orders showing orders for computers and electronics posting a 3.7% MoM increase in March, or 14% YoY.” On the latest reading and the outlook, TD Economics’ Thomas Feltmate said: “Consumer spending was a soft spot in Q1. While some of the weakness can be chalked up to weather related effects, the March figures (also released this morning) also came in a bit softer than expected, suggesting the recent jump in gasoline prices is already having some impact on spending patterns. Higher tax refunds should offer some near-term cushion for households, which alongside continued investments in AI, is likely to keep the economy expanding at around a 2% pace in Q2.”

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects American GDP projections for the next ten years from a panel of 79 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable GDP forecast available for American GDP.

Download one of our sample reports to visualize what a Consensus Forecast is and see our American GDP projections.

Want to get access to the full dataset of American GDP forecasts? Send an email to info@focus-economics.com.