In a fiery social media post, President Donald Trump blamed the economy‘s unexpected contraction on his predecessor, former President Joe Biden.
Data published Wednesday by the Bureau of Economic Analysis showed that the economy contracted at a 0.3% annual rate in the first quarter of 2025. In contrast, last year’s final quarter saw economic output increase by a solid 2.4%, according to the report on the GDP.
This marked the first time the economy contracted since the COVID-19 pandemic.
The report also came as businesses are trying to get ahead of Trump’s 90-day pause on his “Liberation Day” tariffs, which have upended the global financial stock market.
However, Trump has painted the tariffs as a saving grace for the shrinking economy.
“Tariffs will soon start kicking in, and companies are starting to move into the USA in record numbers. Our Country will boom, but we have to get rid of the Biden ‘Overhang.’ This will take a while, has NOTHING TO DO WITH TARIFFS, only that he left us with bad numbers, but when the boom begins, it will be like no other. BE PATIENT!!!” Trump cautioned.
Trump’s senior trade adviser, Peter Navarro, backed the president’s assertions. While talking with reporters on Wednesday, he blamed Biden and his spending bills.
“We inherited a tremendously bad set of economic policies from Joe Biden,” Navarro said. “If you look at the Biden inflation problem, it certainly hasn’t been fully cured.”
The Trump administration has touted the slogan “90 trade deals in 90 days,” with Treasury Secretary Scott Bessent saying there has been significant progress on a deal with India.
However, ahead of any new deals, Americans will likely bear the costs of increased prices that businesses are passing on.
ECONOMY SHRANK IN FIRST QUARTER, SIGNALING MAJOR WARNING
Trump said China, which still faces a 145% tariff, “probably will eat those tariffs” in an interview Tuesday night with ABC News.
Zach Halaschak contributed to this report.
