At a cabinet meeting in Washington, Trump insisted the growth downturn was the legacy of former president Joe Biden’s policies.

The Commerce Department said in a statement that the contraction was in large part down to an “upturn in imports,” aided by a decline in consumer and government spending.

A ‘blaring warning’

The GDP figures were published on the 101st day since Trump returned to White House, along with fresh data showing a slowdown in the US Federal Reserve’s favoured inflation gauge last month.

The US economy has unexpectedly contracted in the first quarter, after a surge in imports. Source: ABACA / Pool/ABACA/PA

Trump’s introduction of sweeping tariffs against most countries sparked a selloff in financial markets, sending volatility to levels not seen since the COVID-19 pandemic.

At the cabinet meeting on Wednesday, Trump said China was getting “hammered” by the tariffs, and said he still hoped to make a deal with Beijing, whom he referred to as “the leading candidate for the chief ripper-offer” of America.

“It reflects instead the sudden change in trade policy that culminated in the biggest drag from net exports in data going back more than a half-century.”