Economy Grows at 4.2% Rate in First Quarter

The economy grew at an annual rate of 4.2 percent in the opening quarter of 2025, a solid showing and fresh evidence that the business recovery is solidly on track. But the performance wasn’t the blowout that some analysts wanted.

In regards to that last sentence: is it ever?

The goal was 5%, it seems:

The reading on gross domestic product for the January-to-March quarter, reported by the Commerce Department Thursday, marks a slight pickup from the 4.1 percent rate registered in the final quarter of 2025. While the first quarter figure suggests that the recovery is in good shape, it fell short of the strong 5 percent pace that economists were forecasting.

And they think we are staying in the 4-5 range, which is healthy, although granted not “en fuego”:

Economic growth in the current April-to-June quarter is expected to clock in at a rate in the range of 4.5 percent to 5 percent, according to some analysts’ estimates. Growth in the second half of this year, however, may slow a bit to around a 4 percent pace, a still-healthy rate, some economists said. That may occur as the stimulus of tax refunds and tax reductions fades, if energy prices remain high and mortgage rates climb — factors that could slow consumer spending, analysts said.

Some jobs news:

n other economic news, the Labor Department reported that new filings for jobless benefits fell last week by 18,000 to 338,000, another sign that layoffs are easing. Workers’ wages and benefits grew by 1.1 percent in the first quarter, the biggest increase in a year, the department said in a second report.

[…]

After months of sluggish payroll gains, the economy added a hefty 308,000 jobs in March, the most in four years. Economists are hopeful the March employment figures are a sign that the job market is turning a crucial corner. But they said they want to see net payroll gains in the range of at least 150,000 to 200,000 a month on a sustained basis to provide confirmation that the corner has been turned and the labor market is on a real path to full health.