The data confirms this: the US economy has just undergone the worst quarter since 2022. In the first quarter it has a negative increase of -0.3 %. This surprising decline in GDP is afraid of decisive turnover for markets and investors. Upstream seems to get worse.
In short
- The US economy dropped to -0.3 % to T1, affected by Trump’s customs policy.
- Despite the signs of weakness, economists believe that the recession is not yet confirmed.
The economy destabilized by Trump’s policy
It’s a fact! PUSH New economic policy President Donald Trump provokes a real earthquake (and not only in the United States!). In just a few months, his prices decisions have:
- He stressed a business deficit;
- disturbed exchanges;
- weakens growth.
Result: GDP, modified for inflation, dropped by -0.3 %. This is a number below 0.8 %of the forecast.
According to the Ministry of Commerce, this decline results mainly from the explosion of imports (+41.3 %) aimed at predicting price increases. Forward, exports increased by only 1.8 %. This dynamics threatens World trade balance.
According to the report:
The difference between import and export since 1947 has reduced GDP most.
The key engineer engine has also slowed down consumption. Specifically, it fell to 1.8 % (compared to 4 % before). Public expenses have worsened this trend. Dropped by -5.1 %.
However, companies’ investments were reflected by 9.8 %. Some analysts reflect this as expectations Upcoming inflation.
Recession or simple slowdown in the economy?
Certainly GDP It is not enough to qualify the situation as a technical recession. The fact is that it requires two consecutive quarters of contraction. But the signals are worrying.
In particular, we refer to unemployment, which remains low: 4.2 %. In addition to this, the basic demand, measured by the final sale of private buyers, is added, which is slightly progressed.
However, as Gregory Daco, Ernst & Young’s economist explains global economy It significantly exposes the risk of significant slowdown (especially if the prices remain unchanged!). They are therefore decisive in the coming months.
The spectrum of recession is not yet a certainty. However, the foundations of the US economy are falling apart. Investors and analysts remain suspended from the development of Trump’s economic policy in the climate of increasing instability!
Maximize your Cointribne experience with our “Read to Earn” program! For each article you read, get points and approach exclusive rewards. Sign up now and start to accumulate benefits.
My name is Ariela and I’m 31 years old. I have been in the area of writing a website for 7 years. I have discovered discovery and cryptocurrency for only a few years. But it is a universe that interests me a lot. And subjects treated in the platform allow me to learn more. In my free time, the singer also cultivates a great passion for music and reading (and animals!)
Renunciation
The words and opinions expressed in this article are involved only by their author and should not be considered investment counseling. Do your own research before any investment decision.
