The American economy grew at a sluggish 0.5% annual pace from October through December, according to the Commerce Department, a downgrade from its previous estimate of 0.7% growth. The slowdown was caused by the 43-day government shutdown and decreased federal government spending and investment, resulting in a 1.16% decrease in GDP growth. For all of 2025, the economy grew 2.1% and 2.9% for all of the year. The outlook for this year is uncertain after the U.S.-Israeli war with Iran disrupted global commerce.