US economy contracts for first time since 2022 as imports surge

Inflation-adjusted GDP fell 0.3% in the first quarter of 2025 — well below average growth of about 3% in the prior two years

US GDP figures reveal that imports surged an annualised 41.3% — the biggest increase in nearly five years — ahead of US president Donald Trump's threatened tariffs. Picture: Alex Brandon/AP

The US economy contracted at the start of the year for the first time since 2022 on a monumental pre-tariffs import surge and more moderate consumer spending, a first snapshot of the ripple effects from president Donald Trump’s trade policy. 

Inflation-adjusted gross domestic product decreased an annualised 0.3% in the first quarter, well below average growth of about 3% in the prior two years, according to the government’s initial estimate published today, Wednesday.