On April 30, 2025, President Donald Trump addressed the first quarterly contraction of the U.S. economy in three years, urging patience and attributing the decline to factors beyond his control. The Commerce Department reported a 0.3% annualized decrease in GDP for Q1 2025, primarily due to a surge in imports as businesses rushed to stockpile goods ahead of impending tariffs under Trump’s “Liberation Day” trade policy.
In a Cabinet meeting, Trump suggested that the economic downturn was a result of policies from the previous administration, stating, “You probably saw some numbers today, and I have to start off by saying that’s Biden.” He also highlighted increased business investment as a positive sign, despite the overall contraction.
Economic adviser Peter Navarro characterized the GDP decline as “the best negative print” he had seen, emphasizing that the downturn was influenced by temporary factors such as import surges and inventory adjustments.
However, economists expressed concerns about the potential for stagflation—a combination of stagnant growth and high inflation—due to the tariffs and their impact on trade flows. Consumer confidence has also declined, with approval of Trump’s economic handling falling to 36%.
Former Vice President Kamala Harris criticized Trump’s economic policies, calling the situation “the greatest man-made economic crisis in modern presidential history” and urging for a unified opposition to his administration.
Source: Reuters
