The U.S. economy came in a bit stronger than expected last year, and the forecast for 2026 looks a bit brighter, Fitch Ratings says — citing the inclusion of recent economic data that was delayed due to the government shutdown.
The rating agency revised its estimate for U.S. GDP growth in 2025 to 2.1%, up from its previous forecast of 1.8%.
The revision came after it incorporated economic data that was initially delayed by last year’s prolonged government shutdown, Fitch said.
Third quarter growth “was considerably stronger than anticipated,” Fitch said, “with upside surprises in consumption, government spending and net trade.”
While the growth of private investment was weaker than expected, the rating agency said that tech investment was still strong and “is contributing significantly to overall GDP growth.”
Additionally, strong equity markets supported consumer spending, it noted.
“Consumption has held up surprisingly well despite a slowdown in real household income growth through 2025 as employment growth has weakened. The saving ratio fell from 5.1% of income in January 2025 to 4.0% in September,” Fitch said.
While growth forecasts have received a boost from the latest data, Fitch said inflation trends “have been hard to interpret given incomplete data for October.”
It estimates that the inflation rate was up to 3% by the end to 2025, and expects it to rise further in 2026, as the effects of higher tariffs feed into higher prices — it expects inflation to come in at 3.2% at by the end of the year.
Despite that forecast, Fitch said it still expects the U.S. Federal Reserve Board to cut rates twice in the first half of 2026.