US Q2 GDP Growth Linked to Tariff Turbulence

U.S. Q2 GDP Growth Expected to Rebound Amid Import Pullback

Analysts predict the United States will regain strength in the second quarter, with growth projected at an annual rate of 2.5 percent for the April‑June period. This marks a reversal from the 0.5 percent decline observed in the first three months.

Why the Bounce Back?

• Import Surge – Businesses built inventory to avoid Trump’s tariffs in the first quarter, creating a record drag on net exports.
• Cooling Imports – As the build‑up unwinds, analysts expect a rebound once imports decline.

Trump’s Tariff Wave

Since taking office, President Trump has rolled out successive duties: 10 percent levies on most partners, higher rates on steel, aluminum and auto imports, and targeted actions against Canada and Mexico. In April a separate arm aimed at China, leading to triple‑digit tariffs and a temporary truce.

Key Economic Trends

• Underlying Activity Moderating – The economy continues to navigate complex crosscurrents, obscuring a clear reading of underlying momentum.
• Inflation Pressures Remeaning – Even as GDP slows, inflationary pressures are re‑emerging.

Impact on Consumer Spending

Tariff‑induced cost pressures, persistent policy uncertainty, curtailed immigration and elevated interest rates collectively dampen employment, business investment and household consumption.

Third‑Quarter Outlook

Analysts anticipate GDP growth to average just 1 percent in the second half of this year, with a likely deceleration in the third quarter as imported goods prices rise sharply and business investment slows under policy uncertainty.