U.S. Economy Contracts Sharply in Q1 2025: Key Factors and Implications
The U.S. economy contracted at an annualized rate of 0.5 percent in the first quarter of 2025, according to the third estimate (BEA).
U.S. financial markets saw significant declines, with the S&P 500 falling 1.4%, the Dow Jones dropping 380 points, and the Nasdaq losing around 2%, extending losses from the previous week.
Investor concerns over the U.S. economic outlook continue to grow, as uncertainty surrounding trade policy weighs on sentiment.
President Trump acknowledged the potential for an economic slowdown but framed the current conditions as a "period of transition" following recent tariff policy adjustments.
