Record Government Shutdown Obscures Underlying Economic Resilience

Washington, Saturday, 21 February 2026.
While the Commerce Department’s latest report shows U.S. GDP growth decelerated to a 1.4% annual rate in the fourth quarter of 2025, the headline figure is deceptive. This slowdown from the third quarter’s robust 4.4% expansion was primarily driven by a singular, temporary distortion: the historic 43-day government shutdown. Analysts estimate this political gridlock subtracted nearly a full percentage point from the final tally, masking an otherwise resilient economic foundation. Crucially, the private sector remains solid; consumer spending—the engine of the U.S. economy—rose by 2.4%, and business investment continued to expand, fueled by heavy spending on artificial intelligence. Rather than signaling a collapse in demand, the data suggests a pause induced by technical factors. With the shutdown resolved and tax refund season approaching, economists forecast a sharp rebound in early 2026, indicating the underlying momentum remains intact despite the optical slump.