America gross domestic product — the nation’s output of goods and services — rebounded after falling from January through March, the Commerce Department reported Wednesday. The first-quarter drop, the first retreat of the U.S. economy in three years, was mainly caused by a surge in imports — which are subtracted from GDP — as businesses scrambled to bring in foreign goods ahead of Trump’s tariffs.
The bounceback was expected but its strength was a surprise: Economists had forecast 2% growth from April through June.
Wednesday’s GDP report showed inflationary pressure easing in the second quarter. The Federal Reserve’s favored inflation gauge – the personal consumption expenditures, or PCE, price index – rose at an annual rate of 2.1% in the second quarter, down from 3.7% in the first. Stripping out volatile food and energy prices, so-called core PCE inflation rose 2.5%, down from 3.5% in the first quarter.
On his Truth Social media platform, Trump heralded the GDP gain and stepped up his pressure on the Federal Reserve to cut interest rates: "2Q GDP JUST OUT: 3%, WAY BETTER THAN EXPECTED! “Too Late” MUST NOW LOWER THE RATE. No Inflation! Let people buy, and refinance, their homes!''
