The Commerce Department's Friday report on the strength of the economy showed that gross domestic product expanded 2.5% on a fourth-quarter-over-fourth-quarter basis last year and 2.9% from the prior year. That marks a downgrade to a previous estimate of 3% and an upwardly revised 2.8% in 2017.

The government's latest update on economic output dashed the Trump administration's longstanding hope for 3% GDP growth in 2018.

The government also said that the U.S. economy grew at a 2.1% annualized rate in the second quarter of 2019, above expectations of economists polled by Dow Jones. GDP expanded 2.3% in the second quarter from the year-earlier period, the slowest rate of increase in two years.

The most recent data undermines Trump's longtime assertion that his policies are pushing growth into a 3%-plus range through a policy cocktail of deregulation, lower taxes and a U.S.-focused trade strategy.

Economists pointed to more muted residential and business investment for the recent decline in GDP prints, with some highlighting persistent trade war worries and higher interest rates for the decline.

Others, like RSM Chief Economist Joseph Brusuelas, added that the waning impact of the administration's tax cuts could also be to blame.

"We're just decelerating. The effects of the 2017 Tax Cut and Jobs Act are now exiting the system and the economy is on its own. What you're going to see is a deceleration in the second half back to the long-term trend of 1.8%," Brusuelas said.