US GDP decline: Trump blames Biden

US President Donald Trump claimed Wednesday that poor US economic data, including a decline in first-quarter gross domestic product (GDP), was a "holdover" from his predecessor, Joe Biden, and that the tariffs he implemented had nothing to do with it. The Republican billionaire, who has vowed to make the United States richer, faced figures Wednesday showing a decline in the country's first-quarter GDP, while the US economy was still thriving at the end of 2024.

At an annualized rate, the preferred measure in the United States, GDP contracted by 0.3%, according to data released Wednesday by the Commerce Department. This represents a decline of 0.1% compared to the previous quarter.

This result is significantly lower than the expectations of most analysts, who were nevertheless anticipating a serious setback (+0.4%) for the world's largest economy. "Our country is going to take off economically, but first, we have to get rid of the remnants of Joe Biden," reacted President Donald Trump, on his Truth Social platform. "It's going to take a while, it has nothing to do with tariffs, it's just that he left us with bad statistics," added the head of state, urging his fellow citizens to "be patient!!!"

Financial markets took a hit. European stock markets plunged into the red after the release of US GDP figures. Wall Street opened sharply lower.

The decline in GDP in the first quarter is largely the result of an arithmetic rule, which means that imports are excluded from its calculation. However, foreign purchases surged at the beginning of the year, a result, according to experts, of companies' desire to get ahead of the imposition of new tariffs and take advantage of conditions prior to Donald Trump's forced economic overhaul.

"The decline in GDP in the first quarter primarily reflects an increase in imports (...) as well as a decline in federal government spending," the official report noted. The Trump administration has also embarked on drastic cuts in public spending.

The US economy was previously more than humming along, with growth of 2.4% in the final quarter of 2024 (annualized), full employment, and inflation on the verge of being brought under control. According to another release Wednesday morning, job creation in the US private sector slowed sharply in April, falling short of expectations.

Another indicator is expected this morning in the United States: the PCE, an index that serves as both an inflation and consumption gauge. These data are being released as the White House tenant celebrates the first 100 days of his second term, which began on January 20.

"I usually think the impact of presidents on economic performance is overstated, especially during the first 100 days in office," Tara Sinclair, an economics professor at George Washington University, told AFP before the GDP figures were released. "But this time," she added, "it's different because the surge in imports is a direct result of buyers avoiding the president's tariffs."

"The risk is that we won't manufacture more in the United States, and at the same time we'll lose the ability to buy cheaply from abroad," Tara Sinclair noted.