GDP growth revised up to 2.1% in first quarter, but underlying demand softened

The Commerce Department said Thursday that the U.S. economy grew at a 2.1% annualized rate in the first quarter of 2026, revising up its final estimate from 1.6%.

The report marked the third and final estimate for January through March. The government had previously reported stronger or weaker readings as more complete data became available, and the latest revision leaves the headline pace modestly firmer than earlier estimated.

Underlying demand was softer

A key measure of private-sector demand moved the other way. Final sales to private domestic purchasers was revised down to 1.7%, a 0.7 percentage-point cut from the prior reading.

That figure is closely watched because it strips out some of the volatility in trade, inventories and government spending, giving a clearer look at demand from households and businesses.

What it means

The stronger headline GDP figure suggests the economy entered 2026 on a somewhat firmer footing than the prior estimate indicated. But the lower final-sales reading points to softer underlying demand than the top-line number alone suggests.

AP reported that the release came from the Commerce Department’s final estimate of first-quarter GDP and said the next initial estimate for second-quarter GDP is due July 30, 2026.

Coverage of the report said business investment helped support the quarter, while consumer spending was softer.