Trade Wars Trigger US Economic Downturn
The US economy contracted by 0.5% from January to March due to Trump's trade wars, according to the Commerce Department. A surge in imports dropped GDP, marking the first contraction in three years. Federal spending also declined significantly, but economists predict a second-quarter rebound.
- Country:
- United States
The Commerce Department has reported that the US economy shrank at an annual rate of 0.5% between January and March. This downturn is attributed to the trade wars initiated by President Donald Trump, which have disrupted business operations.
The significant influx of imports by companies trying to circumvent impending tariffs led to a reduction in GDP by nearly 4.7 percentage points. Consumer spending witnessed a sharp decline, and federal government expenditure fell by an annualized rate of 4.6%, the steepest drop since 1986.
Despite the first-quarter import spike affecting GDP figures, economists anticipate a recovery in the second quarter, projecting a growth of 3%. The April-June GDP growth report is scheduled for release on July 30.
(With inputs from agencies.)
ALSO READ
Pakistan's Ambitious Economic Growth Plan Faces Skepticism
Mashatile: Youth Empowerment and Economic Growth Top Government Agenda
American Sentiment on Federal Spending: Poll Reveals Disconnect
Poland Secures Major EU Recovery Fund Distribution for Economic Growth
Finland Revises Economic Growth Forecast Amid Global Trade Tensions
Google News