The BLS released the GDP for the 3Q and it showed strong growth but higher inflation: Preliminary GDP for Q3 4.3% vs 3.3% estimateSales 4.6% vs 7.5% last quarterDeflator 3.7% vs 2.7% estimate. Prior 2.1%Core PCE 2.9% vs 2.9% estimate. Prior 2.6%Consumer spending 3.5% vs 2.5% priorFor the full report: CLICK HERE. Decoding the Q3 2025 GDP GrowthThe latest data from the U.S. Bureau of Economic Analysis (BEA) reveals that the American economy expanded at a robust 4.3% annualized rate during the third quarter of 2025. This performance exceeded most market expectations, which had centered around a 3.3% expansion.Based on the provided chart, here is the breakdown of the key contributors to this growth:The Primary Drivers of GrowthConsumer Spending (The Engine): Household spending remains the primary catalyst for the economy, contributing +2.40 percentage points to the overall GDP figure. This reflects continued resilience in private consumption despite earlier concerns of a slowdown.Exports (Global Demand): Strong international demand for American products and services added +0.90 percentage points to the growth rate.Imports (Calculation Quirk): According to the BEA, imports are a subtraction in the GDP formula. A decrease in imports resulted in a +0.65 percentage point positive contribution to the final figure.Government Spending: Public sector expenditures provided a modest tailwind, contributing +0.40 percentage points to the quarterly expansion.The Sole HeadwindInvestment: Private domestic investment was the only negative contributor in the chart, shaving -0.02 percentage points off the total. This suggests a slight caution among businesses regarding capital expenditures or residential housing activity during the quarter.The Bottom LineWith a 4.3% growth rate, the U.S. economy remains significantly stronger than many global peers. While some volatility remains due to shifting trade patterns and labor market updates, the dominance of consumer spending indicates that the domestic economic core remains remarkably firm as we head into the final months of the year.Summary Table: Q2 vs. Q3 Growth ContributionsAtlanta Fed GDPNow: Final Q3 2025 SummaryThe Atlanta Fed GDPNow model showed a final reading of 3.5% lower than the 4.3% from the actual data. The data showed a lower contribution from consumer spending of 1.84% vs 2.4% . Headline Growth EstimateFinal Estimate: Real GDP growth is projected at 3.5 percent (seasonally adjusted annual rate).Recent Trend: This represents a slight downward revision from the 3.6 percent estimate recorded on December 11.Context: The estimate peaked at 4.2 percent in late November before cooling off through December.Key Internal DriversThe December 16 update incorporated new data from the US Census Bureau and the US Bureau of Labor Statistics, leading to minor adjustments in the growth components:Consumer Spending: Contribution to real GDP growth fell slightly to 1.84 percentage points.Inventory Investment: Contribution was also adjusted downward, falling to 0.09 percentage points. This article was written by Greg Michalowski at investinglive.com.