Trade shock own goal hits US economy - with worst performance in three years By James Sillars, business and economics reporter The first US economic growth figures covering Trump 2.0 are out - and make for extremely grim reading at the White House. The Commerce Department has reported, in a preliminary reading, that the world's largest economy contracted during the first three months of the year. Economists and financial markets had largely expected growth of 0.3%. But the measure showed that the economy shrank at an annualised rate (a calculation of performance over a 12-month period, as opposed to just one quarter) of 0.3% between January and March. That was the worst performance for three years and sharply down on the solid 2.4% rate of growth measured over the previous three months. So far, tariffs having opposite effect to what was intended The data showed the main culprit was a surge in imports - stockpiling to beat trade tariffs threatened after confirmation that Donald Trump had won a second presidential term. The US trade deficit - public enemy number one as far as Trump is concerned - has widened sharply since December. That's in stark contrast to his central mission of cutting that gap between the value of America's exports and imports. The rush to avoid tariffs has beaten several monthly records, with the deficit in goods trade hitting a new high in March. True impact not yet known Analysts say that while the headline figure appears to be a disaster for Trump, the impact from the hoarding of imported goods distorts the true picture of US economic health. More important, many argue, will be how the commencement of the main trade war this month will play out. There are fears that inflation will rise sharply due to higher import costs being passed on, limiting the US central bank's ability to cut interest rates for consumers and businesses alike. All this at a time when stock markets and the dollar are still reeling from the effects of the "Liberation Day" trade salvoes. Will there be a recession? The International Monetary Fund recently forecast annual growth of 1.8% for the US this year. But some economists see a 50/50 chance of a recession ahead. US futures showed further falls for stock markets on Wall Street at the open. How Trump responds will be the most eagerly anticipated information for investors moving forward.