United States President Donald Trump blamed former president Joe Biden for the American economy’s downturn, after official data revealed an unexpected contraction in the first quarter of the year.

The US Commerce Department reported on Wednesday that the country’s gross domestic product fell at an annual rate of 0.3 percent between January and March, marking the first quarterly decline since 2022. This represented a sharp contrast to the 2.4 percent growth registered in the last quarter of 2024 and fell significantly short of the 0.4 percent increase forecast by analysts at Briefing.com.

According to the Commerce Department, the contraction in real GDP stemmed from a surge in imports, a slowdown in consumer expenditure, and a reduction in government outlays. Officials attributed the spike in imports to pre-emptive stockpiling by businesses and consumers bracing for President Trump’s sweeping tariffs, which had taken effect earlier in the month.

Reacting to the figures, Trump declared on his Truth Social platform, “This is Biden's Stock Market, not Trump's. Our Country will boom, but we have to get rid of the Biden ‘Overhang.’” He added, “This will take a while, has NOTHING TO DO WITH TARIFFS. When the boom begins, it will be like no other. BE PATIENT!!!”

Minutes later, Trump’s economic advisor from Washington, Peter Navarro, addressed reporters and defended the data. “This was the best negative print — as they say in the trade — for GDP I have ever seen in my life,” Navarro stated. He insisted that the import surge had been “totally driven by the rest of the world trying to get their products in here before the tariffs took full hold.” Navarro added, “That’s a one shot deal. So next time we get the data, that won’t be the case at all.”

The GDP report coincided with the 101st day since Trump’s return to office on 20 January. Within that period, the administration had unveiled several tariff measures, including a broad plan introduced in March that aimed to reset trade terms by applying sweeping levies from early April.

Financial markets reacted sharply to the policy shift, with all three major Wall Street indices opening lower. The Nasdaq composite fell by more than two percent before recovering some of its losses later in the session.

Amid heightened market volatility, the Trump administration announced a 90-day pause on higher tariffs for multiple countries to facilitate trade negotiations, while maintaining a 10 percent base rate for most others. Additional sector-specific duties were imposed on steel, aluminium, automobiles, and foreign-made components. The administration also enacted new tariffs totalling 145 percent on Chinese goods, which prompted retaliatory measures from Beijing.

Reacting to the economic data, Democratic Senate Minority Leader Chuck Schumer stated, “Today’s GDP number shows Donald Trump is running America the same way he ran his business — straight into the ground.” He continued, “This decline in GDP is a blaring warning to everyone that Donald Trump and Congressional Republicans’ failed MAGA experiment is killing our economy.”

Economists from Wells Fargo, in an investor note, noted that the contraction did not signal the beginning of a recession. “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,” they wrote. They attributed the downturn to an abrupt shift in trade policy, which led to the “biggest drag from net exports in data going back more than a half-century.”