economy

March 13, 2026

Fourth-quarter GDP revised down to just 0.7% growth; January core inflation was 3.1%

The PCE price index for January was expected to show headline inflation at 2.9% and core at 3.1%.

Fourth-quarter GDP revised down to just 0.7% growth; January core inflation was 3.1%

TL;DR

  • Fourth-quarter GDP growth revised down to 0.7%, significantly below previous estimates and the prior period's 4.4%.
  • Core personal consumption expenditures (PCE) price index rose 0.4% in January 2026, with the annual rate at 3.1%, above the Federal Reserve's target.
  • Consumer spending growth slowed to 2% in the fourth quarter, and durable goods orders were flat in January.
  • The combination of slow growth and rising inflation raises concerns about stagflation and may lead the Federal Reserve to hold interest rates longer or even consider hikes.
  • Economic data predates recent geopolitical events that have caused energy prices to surge, further complicating inflation concerns.

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