The US economy has shown unexpected contraction at an annualized rate of 0.3% for the first quarter of 2025, coinciding with President Trump's 100-day milestone. A surge in imports, which saw an increase of over 40%, primarily resulted from anticipations surrounding an upcoming tariff announcement. Moreover, consumer spending growth, essential for post-pandemic recovery, has hit its lowest level in nearly two years, overshadowed by looming price pressures from tariffs. Forecasts from the Cebr indicate a decline in GDP growth to 1.4% in 2025 from 2.8% in 2024, showing a worrying reversal in economic trajectory.
The advance estimates reveal a concerning contraction of the US economy at an annualized rate of 0.3% in Q1 2025, particularly troubling as it follows President Trump's initial 100-day milestone.
A significant contributor to this economic downturn was a surge in imports, which increased over 40% in anticipation of the President's impending tariff announcements slated for April.
Consumer spending, which had been the cornerstone of the US's post-pandemic recovery, has now slowed to its lowest point in nearly two years, primarily due to rising prices from tariffs.
Looking ahead, forecasts suggest that US GDP growth will decline to 1.4% in 2025, a marked decrease from 2.8% in 2024, indicating a significant economic slowdown.
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