U.S. economy contracts in Q1 amid impact from tariff-fueled imports – National [Video]

The U.S. economy contracted in the first quarter, weighed down by a deluge of goods imported by businesses eager to avoid higher costs, underscoring the disruptive nature of President Donald Trump’s often chaotic tariff policy.

Gross domestic product decreased at a 0.3 per cent annualized rate last quarter, the Commerce Department’s Bureau of Economic Analysis said in its advance estimate of first-quarter GDP on Wednesday.

Economists polled by Reuters had forecast that GDP increased at a 0.3 per cent pace in the January-March period. The survey was, however, concluded before data on Tuesday showed the goods trade deficit surged to an all-time high in March amid record imports, which prompted most economists to sharply downgrade their GDP estimates.

The economy grew at a 2.4 per cent pace in the fourth quarter.

But the report likely grossly exaggerated the economy’s dimming prospects as consumer spending continued to grow, though at a moderate …