04-30-2025, 02:39 PM
Well, that didn’t take long, since it only reflects the last three months - that is, Trump’s first 100 days. But it’s even worse than expected.
Some decrease was actually anticipated, since companies and consumers stocked up when it became clear that Trump was actually going to go forward with his nutso tariff policy, and imports decrease the GDP mathematically.
What else was expected, but came in worse? Inflation:
Stagflation is here. It’s starting to look like the Atlanta Fed was right about a recession coming, unless something changes drastically soon.
The Bureau of Economic Analysis' advance estimate of first quarter US gross domestic product (GDP) showed economic growth contracted at an annualized rate of 0.3% during the year's first three months, more than the 0.2% decline expected by economists surveyed by Bloomberg. The reading came in significantly lower than the 2.4% rate of growth seen in the fourth quarter of 2024.
This marked the first quarter of negative GDP growth since the first quarter of 2022.
Some decrease was actually anticipated, since companies and consumers stocked up when it became clear that Trump was actually going to go forward with his nutso tariff policy, and imports decrease the GDP mathematically.
"Trade was a huge influence," PNC Financial Services Group chief economist Gus Faucher told Yahoo Finance. "We saw companies bringing in a lot of imports to try to get ahead of tariffs. We saw a huge build in inventories.
What else was expected, but came in worse? Inflation:
The "core" Personal Consumption Expenditures index, which excludes the volatile food and energy categories, grew by 3.5% in the first quarter, [well] above estimates for 3.2% and [waay] above the 2.6% seen in the prior quarter.
Stagflation is here. It’s starting to look like the Atlanta Fed was right about a recession coming, unless something changes drastically soon.