WASHINGTON, United States (AFP)— President Donald Trump lashed out at his predecessor’s economic record Wednesday after US financial markets fell on the news that the American economy unexpectedly contracted in the first three months of the year.

The gross domestic product of the world’s largest economy decreased at an annual rate of 0.3 percent in the first quarter, after growing 2.4 percent in the final months of 2024, according to Wednesday’s estimate from the US Commerce Department.

This was sharply below the market consensus estimate of 0.4 percent growth, according to Briefing.com, and marked the first quarterly contraction since 2022.

“The downturn in real GDP in the first quarter reflected an upturn in imports, a deceleration in consumer spending, and a downturn in government spending,” the Commerce Department said in a statement.

The surge in imports was driven by businesses and consumers stockpiling foreign goods to get ahead of Trump’s sweeping tariffs, which went into effect earlier this month.

“This is Biden’s Stock Market, not Trump’s,” the US president wrote in a post on his Truth Social platform. “Our Country will boom, but we have to get rid of the Biden ‘Overhang.'”

“This will take a while, has NOTHING TO DO WITH TARIFFS,” he said. “When the boom begins, it will be like no other. BE PATIENT!!!”

All three major Wall Street indices fell at the open, with the Nasdaq sliding more than two percent before paring some losses in morning trading.

– ‘A blaring warning’ –
Speaking to reporters a few minutes after the president’s post, Trump’s economic advisor Peter Navarro defended the GDP figures.

“This was the best negative print — as they say in the trade — for GDP I have ever seen in my life,” he said. “It really should be very positive news for America.”

The import surge was, he said, “totally driven by the rest of the world trying to get their products in here before the tariffs took full hold.”

“That’s a one shot deal,” he added. “So next time we get the data, that won’t be the case at all.”

The GDP figures were published on the 101st day since Trump returned to White House on January 20, along with fresh data showing a slowdown in the US Federal Reserve’s favored inflation gauge last month.

In that time, the president has announced several rounds of tariffs, laying out plans in March to impose sweeping levies on top trading partners from early April in a bid to reset US trade relations.

The introduction of tariffs sparked a selloff in financial markets, sending volatility surging to levels not seen since the Covid-19 pandemic and spooking investors.

“Today’s GDP number shows Donald Trump is running America the same way he ran his business — straight into the ground,” Democratic Senate minority leader Chuck Schumer said in a statement.

“This decline in GDP is a blaring warning to everyone that Donald Trump and Congressional Republicans’ failed MAGA experiment is killing our economy,” he added.

– ‘Greater risk of recession’ –
Following the dramatic market movements in early April, the Trump administration announced a 90-day pause to the higher tariffs for dozens of countries to allow for trade talks, while maintaining a baseline 10 percent rate for most countries.

It also announced sector-specific measures on steel, aluminum and automobiles and parts not made in the United States, and new sweeping tariffs totalling 145 percent on China.

Beijing responded with its own steep, targeted measures against US goods.

“The U.S. economy is at a greater risk of recession now than it was a month ago, but this 0.3 percent contraction in Q1 GDP is not the start of one,” economists at Wells Fargo wrote in an investor note.

“It reflects instead the sudden change in trade policy that culminated in the biggest drag from net exports in data going back more than a half-century,” they said.