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Trump promises economic boom, but US GDP slumps: -0.3% in Q1
First quarter down since 2022: weighed by tariff effect, confidence at lows and tensions over trade. Trump accuses Biden and downplays: ‘Be patient’
Donald Trump continues to show optimism and confidence, celebrating the results of his first 100 days in office. However, behind the triumphalist narrative lies a worrying fact: the US economy has recorded its first contraction since 2022. According to preliminary data released by the Commerce Department, US GDP fell by 0.3% in the first quarter of 2025, after +2.4% in the last three months of 2024.
Falling confidence and markets in crisis
The economic slowdown coincided with a slump in consumer confidence, which fell 32% in April, marking the worst level since the 1990 recession. US stock markets reacted with a sharp drop immediately after the report was released, fuelling fears of a possible technical recession, defined by two consecutive quarters of negative growth.
The tariff strategy and its consequences
Among the main causes of the economic slowdown are the Trump administration’s recent trade policy choices. The imposition of new tariffs has triggered tensions with China and agitated the domestic market, destabilising companies and consumers. According to a CNN analysis, the president’s ambitious plan to redraw the balance of global trade risks driving up inflation and pushing the country into a full-blown recession.
Trump downplays and points the finger at Biden
Despite the disappointing data, President Trump sought to play down concerns, attributing the economic woes to his predecessor’s legacy. ‘Our country will prosper, but we need to get rid of Biden’s excess,’ he wrote in a social media post. He called for patience, promising that ‘the economic boom will be like no other.’ At a Cabinet meeting, he reiterated: ‘This is Biden, it’s not Trump’.
The import-export issue and the weight on GDP
The report shows that the contraction of the economy has been strongly influenced by an increase in the trade deficit. Many Americans brought forward purchases to avoid tariff hikes, causing imports to soar 41.3% in the first quarter (from -1.9% previously), while exports grew only 1.8%. The result was a negative trade balance that had a historic impact on GDP. According to CNN, this is the largest subtraction from the gross domestic product since 1947.
Navarro: ‘It’s the best bad news I’ve ever read’
Peter Navarro, Trump’s chief trade adviser, commented on the report in unexpectedly positive tones. Interviewed by CNBC, he urged not to stop at the surface, highlighting the increase in domestic investment. However, the Commerce Department pointed out that this growth is mainly related to the accumulation of stocks by companies, which are worried about the impact of the impending duties.
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