The economy of the United States has recoiled. This is according to fresh data from the Labour Department’s Bureau of Economic Analysis, which shows that the US economy shrank for the first time in three years in the first quarter of this year. The economy shrank at an annual rate of 0.3 percent.
The shrinking of the US economy has been attributed to trade tariffs that have been instituted by the US president Donald Trump since February 2025. The economy, as a measure of GDP, shrank in part after companies rushed to stockpile imported goods to avoid the impact of Trump’s tariffs.
In the first quarter of 2025, expansion in gross domestic product which is the country’s output of goods and services, went down from 2.4 percent in the last quarter of 2024. At the same time, imports went down by 5 percentage points in the same period while consumer spending also recorded a decrease. Expenditure by the federal government went down by 5.1 percent.
However, President Trump has blamed former President Joe Biden for the economic slowdown, even though the US economy had recorded a growth in the last quarter of Biden’s administration.
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“This is Biden’s economy because we took over on January 20th. I think you have to give us a little bit of time to get moving,” Trump was quoted by the BBC.
The new numbers came as the US president marked his first 100 days in office, amidst a global tariffs battle that he has opened with multiple countries in Europe, Asia and North America.
At the same time, the numbers came barely days after reports showed the number of visitors from overseas to the United States shrank by 11.6 percent in March 2025. The number of visitors traveling to the US from western Europe dropped by 17.2 percent, with Spain and Germany recording drops of 25 percent and 28 percent respectively.
