Trump reacts to the news of the US economy contracting with an urgent appeal and sharp criticism of Joe Biden
This follows official reports from the US Bureau of Economic Analysis that indicate a downturn in the economy
Former President Donald Trump has responded to concerns regarding a potential recession in the United States after the economy showed signs of contraction in recent months.
Data released by the US Bureau of Economic Analysis revealed that the country’s Gross Domestic Product (GDP) shrank by 0.3% on an annualized basis in the first quarter of this year.
The slowdown in growth during the first quarter was attributed to a surge in imports as US businesses rushed to bring in goods from abroad before Trump imposed heavy tariffs.
The decline in GDP for January to March reversed the 2.4% growth experienced in the last quarter of 2024.
Imports rose sharply at a rate of 41%, the fastest increase since 2020, contributing to a five-percentage-point reduction in overall growth during the first quarter.
Former President Donald Trump has blamed the Biden administration for the economic contraction in the US.
Meanwhile, consumer spending slowed significantly, falling to just 1.8% growth, down from 4% in the fourth quarter of last year. Additionally, federal government spending dropped by 5.1% during the first quarter.
Forecasts from financial experts surveyed by FactSet had expected a modest 0.8% growth in the first quarter, though many had predicted the GDP to decline.
In response to the report, President Trump took to Truth Social to address the figures and pointed the finger at former President Joe Biden.
“This is Biden’s market, not mine,” he wrote. “I didn’t assume office until January 20th. Tariffs will soon start to have an effect, and companies are relocating to the US at record levels.”
“Our economy will thrive, but we need to eliminate the Biden ‘drag.’ This will take time, and it has NOTHING TO DO WITH TARIFFS; it’s simply that he left us in a bad position. But when the recovery starts, it will be unprecedented.”
“BE PATIENT!!!”
Trump is confident that the US economy will rebound under his leadership and has urged Americans to remain patient.
These numbers come as Trump’s trade policies have shaken up global commerce. He imposed tariffs of up to 245% on Chinese imports, with China retaliating with levies of up to 125% on US goods.
However, the report wasn’t entirely negative. It also highlighted a significant 21.9% increase in business investment. Another key measure of the economy’s strength, which includes private investment and consumer spending while excluding volatile factors like government spending and exports, rose by a healthy 3% annual rate from January to March, up from 2.9% in the previous quarter of 2024.
The surge in imports, the largest since 1972 (excluding the impact of the Covid-19 pandemic), is expected to ease in the second quarter, alleviating some of the downward pressure on GDP.
For that reason, Paul Ashworth of Capital Economics predicts that growth will bounce back to a 2% increase in the April to June period.
