Washington, D.C. — The U.S. economy contracted in the first three months of this year, according to data released Wednesday, primarily due to a surge in imports ahead of the implementation of tariffs imposed by Donald Trump.
The Republican blamed his predecessor, Democrat Joe Biden, and called for “patience.” “When the boom starts, it will be like no other,” he promised.
The gross domestic product of the world’s largest economy fell 0.3% at an annualised rate in the first quarter, after increasing 2.4% in the last three months of 2024, according to an estimate by the U.S. Department of Commerce.
Analysts had expected GDP growth of 0.4%, according to Briefing.com.
“The decline in real GDP in the first quarter reflects a rebound in imports, a slowdown in consumer spending, and a decline in government spending,” the Commerce Department said.
Trump blames Biden and asks for “patience”
The figures were released on the 101st day of Trump’s second term. During that time, he has announced several sets of tariffs that have sparked significant global uncertainty.
In March, it announced steep tariffs on products from its main trading partners starting in early April, in an attempt to renegotiate its trade agreements.
This shook the financial markets, with levels of volatility not seen since the COVID-19 pandemic.
However, Trump blamed his predecessor, Democrat Joe Biden, for Wednesday’s negative results. “I didn’t take office until January 20th,” Trump wrote on his Truth Social network.
“Tariffs will soon begin to be implemented, and businesses are starting to move to the U.S. in record numbers. Our country will prosper, but we need to get rid of the Biden burden,” he added.
“This will take a while, it has nothing to do with tariffs, it just left us with bad numbers, but when the boom starts, it will be like no other. BE PATIENT!!!” he wrote.
Following the sharp decline in markets in April, Trump announced a 90-day pause on tariff increases for dozens of countries, intending to allow for negotiations. For most of them, he maintained a 10% floor.
He also announced specific measures for sectors such as steel, aluminum, and automobiles and auto parts not manufactured in the United States.
The new U.S. tariffs reach 145% on several Chinese products, and Beijing responded with new levies of 125% on imports from the United States.
“Generally, government policy doesn’t change that much, especially in the first 100 days of a presidency,” George Washington University economics professor Tara Sinclair told AFP before the data was released. “But this one is different.”
“I think it’s pretty clear that it was the dramatic policy changes that directly weakened the economy,” he added.
Following the GDP data, Wall Street opened lower on Wednesday: the Dow Jones fell 0.7%; the Nasdaq, 2.07%; and the S&P 500, 1.35%.
“Direct response” to Trump
The U.S. economy grew 2.8% last year, according to the Commerce Department. By 2025, analysts expected growth to slow but remain around 2%.
Since Trump returned to power, and with the introduction of new tariffs, many analysts had significantly reduced their growth projections.
Imports had a negative effect on growth, offsetting potential gains from exports in GDP calculations.
“This surge in imports comes directly from people trying to preempt tariffs,” said Sinclair of George Washington University. “And this is a direct response to this president’s policies.”