From the BEA:
Real gross domestic product (GDP) decreased at an annual rate of 0.3 percent in the first quarter of 2025 (January, February, and March), according to the advance estimate released by the U.S. Bureau of Economic Analysis. [Bolding in original]
And:
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.
Then this happened:
Trump and his aides struggled to coalesce around a message about the GDP number, simultaneously saying it was bad because of Biden administration policies but also good because of Trump's efforts."You probably saw some numbers today, and I have to start off by saying that's Biden," Trump said to reporters, without elaborating as he referred to his Democratic predecessor.
Because of course he did.
The first-quarter decline was largely a result of quirks in the way economic activity is measured. More reliable data on consumer spending and business investment suggested that growth slowed in the first quarter but didn’t contract.
But while the negative number was misleading, it reflected something real about the way Mr. Trump has upended the economy in his first months in office. Consumers raced to buy cars and other goods before tariffs took effect. Businesses did the same with equipment, parts and raw materials, laying in stores for the trade war to come.
Moreover, the first-quarter figures were a glimpse at the past, before Mr. Trump announced even more sweeping tariffs in early April. That announcement, and the series of escalations and reversals that followed, caused chaos in financial markets and set off a full-blown trade war with China.
I can't wait until we see the next quarter's GDP!
