Trains at a rail yard in Atlanta. (Megan Varner/Bloomberg)

The U.S. economy shrank 0.3% from January through March, first drop in three years.

It was slowed by a surge in imports as companies in the United States tried to bring in foreign goods before President Donald Trump imposed massive tariffs.

The January-March expansion was the slowest in almost three years and was down from 2.4% in the last three months of 2024. Imports shaved 5 percentage points off first-quarter growth.

Consumer spending also slowed sharply.

Trump inherited a solid economy that had grown steadily despite high interest rates imposed by the Federal Reserve to fight inflation. His erratic trade policies — including 145% tariffs on China — have paralyzed businesses and threatened to raise prices and hurt consumers.

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