US economy shrinks 0.3%, companies race to get ahead of Trump tariffs
Dharshini David
Deputy economics editor
Not 24 hours after the White House Press Secretary claimed that the American economy was going great guns, there's dramatic proof that it wasn't – even ahead of so-called Liberation Day.
This is a worse outcome for growth than economists expected. Some of the first quarter's weakness was due to a surge in imports, as retailers stockpiled ahead of tariffs coming in – and that counts as depressing GDP growth.
But, with consumer spending weak, there are clear signs that the damage to growth may be sustained.
Influential economists had previously warned that the risk of the US economy falling into recession this year was close to 50%.
Many will be hastily readjusting those expectations, fearing that the pain for households and businesses has come sooner and will be more acute.
And don't forget, Americans account for $1 in $6 of global consumer spending – if they're not buying, it's harder for other countries to sell. We're not immune to their pain
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