The U.S. economic growth contracted at an annual rate of 0.3 percent in the first quarter of 2025 according to the Department of Commerce statistics released Wednesday, which marks first 100 days of President Donald Trump‘s second term.
The advance estimate released by the U.S. Bureau of Economic Analysis showed the real gross domestic product growth fell from January to March.
In comparison, the real GDP had increased 2.4 percent in the fourth quarter of 2024.
Since commencing his White House term on January 20, Trump has announced a baseline tariff on all imports into the United States. In addition, the President has also introduced reciprocal tariffs on imports from countries.
Although, Trump has paused tariffs on imports and announced some relief for American automakers, the economic policy has caused volatility in the stock market while consumer confidence has also dropped to the lowest level in decades.
On Wednesday, Trump asked people to be patient to see the results of his tariff-focused policies and blamed the former Joe Biden Administration for the slowdown in the first quarter.
“This is Biden’s Stock Market, not Trump’s,” he wrote in a post on Truth Social media platform.
“I didn’t take over until January 20th. Tariffs will soon start kicking in, and companies are starting to move into the USA in record numbers.
“Our Country will boom, but we have to get rid of the Biden ‘Overhang.’ This will take a while, has NOTHING TO DO WITH TARIFFS, only that he left us with bad numbers, but when the boom begins, it will be like no other.
“BE PATIENT!!!”
According to the University of Michigan’s Institute for Social Research, the consumer sentiment index has declined by 32 points.
U.S. Bureau of Economic Affairs said, the “decrease in real GDP in the first quarter primarily reflected an increase in imports, which are a subtraction in the calculation of GDP, and a decrease in government spending.”
These movements were partly offset by increases in investment, consumer spending, and exports, the Bureau said.
Real final sales to private domestic purchasers, the sum of consumer spending and gross private fixed investment, increased 3.0 percent in the first quarter, compared with an increase of 2.9 percent in the fourth quarter, the Bureau of Economic Affairs noted.
“The price index for gross domestic purchases increased 3.4 percent in the first quarter, compared with an increase of 2.2 percent in the fourth quarter.”
According to the figures, the personal consumption expenditures (PCE) price index increased 3.6 percent, compared with an increase of 2.4 percent. Excluding food and energy prices, the PCE price index increased 3.5 percent, compared with an increase of 2.6 percent.
