Growth

Gross Domestic Product — Q1 2026 (Second Estimate)

Released May 28, 2026 · 8:30 AM ET · Source: U.S. Bureau of Economic Analysis

Real gross domestic product — the broadest measure of U.S. economic output — increased at an annual rate of 1.6 percent in the first quarter of 2026, according to the second estimate. That is a downward revision of 0.4 percentage point from the 2.0 percent advance estimate released in April. Real GDP grew 0.5 percent in the fourth quarter of 2025, so the first quarter was still an acceleration. The PCE price index rose 4.5 percent, unchanged from the advance; core PCE rose 4.4 percent, revised up 0.1 percentage point.

What's real

Two different signals sit inside one release. Which one matters depends on what the reader is trying to measure. For the size of the U.S. economy as a whole, the headline real GDP figure is the right number, and 1.6 percent is the second-estimate read. For the trend in domestic demand stripped of trade and inventory swings, real final sales to private domestic purchasers — consumer spending plus business fixed investment — is the right number, and that ran at 2.4 percent, revised down 0.1 percentage point.

The downward revision came from two places. Inventory investment was revised lower, led by manufacturing and retail trade, on revised Census Bureau book-value data. Consumer spending on services was revised down, led by health care — outpatient services as well as hospital and nursing-home services — on revised Quarterly Services Survey data. That was partly offset by an upward revision to spending on goods.

Real gross domestic income — the same economy measured from the income side rather than the output side — rose 0.9 percent, compared with 1.6 percent in the fourth quarter of 2025. The average of real GDP and real GDI, which BEA publishes as a less-noisy combined reading, came in at 1.3 percent.

What's noise

A four-tenths-of-a-point revision between the advance and second estimates sits well within the historical range. The advance number uses partial source data and BEA assumptions for components not yet reported; the second folds in actual Census Bureau survey results that did not exist when the advance was published. Most quarters carry a revision of similar magnitude in one direction or the other.

The 0.7-point gap between GDP and GDI looks meaningful in isolation, but the two measures regularly disagree by more than that. They measure the same economy from two sides, and the gap reflects measurement noise rather than two different economies. The 1.3 percent average is the figure BEA publishes specifically to reduce that noise.

What it means

The release tells us that the U.S. economy grew at a slower pace than the advance estimate suggested, that the slowdown showed up in inventory investment and in services spending on health care, and that prices continued to run faster than the Federal Reserve's 2 percent objective on both the headline and core PCE measures. The acceleration from 0.5 percent to 1.6 percent still describes a pickup in growth from the prior quarter, just a smaller one. The next print lands June 25.

The headline cooled; the trend stayed mixed.