So, the latest US GDP numbers just came out, and it’s not great news – the economy actually shrank by 0.3% in the first quarter of 2025.
Trump’s Tariff Rush Triggers GDP Dip
That’s the first time we’ve seen the economy contract since early 2022. Naturally, this got a lot of attention, especially from former President Donald Trump.
Trump quickly pointed fingers at President Biden, saying the current economic slump is really Biden’s fault – or what he calls the “Biden overhang.”
He posted on Truth Social that the bad numbers are leftover problems from Biden’s time in office, not because of his own tariff policies.
Trump also said that tariffs will soon help boost the economy, with companies moving back to the US in big numbers. But he warned that the “boom” he expects will take some time to kick in, so people should be patient.
At the same time, another report showed that US job growth is slowing down. In April, private payrolls only increased by 62,000, which is way below what experts expected (they were looking for around 120,000 new jobs). This was the smallest job gain since July 2024 and a big drop from March’s 147,000 jobs added.
All this bad news hit the stock market hard, with shares dropping sharply right after the reports came out. It’s a tricky moment for Trump, who was scheduled to meet with business leaders at the White House that same day.
His habit of blaming others for economic problems might make it harder for him to convince people that the economy is actually doing well.
Trump has been claiming lately that prices are falling and that he’s responsible for that. But the numbers tell a different story.
The government’s preferred inflation measure, the personal consumption expenditures (PCE) price index, actually jumped 3.6% in the first quarter – that’s higher than the 2.4% rise seen in the previous quarter. So inflation is still a big issue.
Experts say the slow job growth and shaky consumer confidence are tied to the uncertainty caused by Trump’s tariff policies. His current strategy seems to be to dodge blame for the economy’s troubles, just like he tried to take credit for the stock market’s gains during Biden’s presidency.
Back in January 2024, when Trump was still running for president, he posted confidently that the stock market was his to win – despite the polls and projections saying otherwise.