The Turbulent Impact of Tariffs on the U.S. Economy

In the first quarter, the U.S. economy contracted by 0.3% as businesses imported goods to avoid higher tariffs, highlighting the disruption from President Trump's tariff policy. The record goods trade deficit led economists to lower their GDP growth estimates, casting doubt on economic prospects amidst ongoing trade tensions.

The U.S. economy witnessed a 0.3% contraction in the first quarter as businesses rushed to import goods, fearing increased costs due to tariffs. This development throws light on the unsettling impacts of President Donald Trump's unpredictable tariff policy, contributing to economic uncertainty.

The Commerce Department's Bureau of Economic Analysis revealed that the GDP decreased at a 0.3% annualized rate in its advance estimate for the first quarter. This was contrary to economists' initial expectations of a growth rate, as recent data showcased the largest-ever goods trade deficit in March due to unprecedented imports.

The economic landscape, tied with Trump's first 100 days in office, appeared bleak amid growing public disapproval over his economic handling. While Trump's tariff strategy includes a 145% duty on Chinese goods, economists warn of its inflationary impact, influencing consumer and business sentiments and prompting the Federal Reserve to consider interest rate cuts.

(With inputs from agencies.)