Our economy just roared back with a vengeance, clocking a stunning 3.8% GDP growth for the April-to-June quarter, as revised by the Commerce Department.
The Daily Mail reported that this powerhouse performance, the strongest in two years, showcases a resilient U.S. economy driven by robust consumer spending and a sharp drop in imports, despite earlier stumbles.
Let’s rewind to the first quarter, where GDP took a hit, dropping 0.6%—the first decline in three years—largely due to a flood of imports as businesses scrambled ahead of President Trump’s tariff policies.
Those trade wars, a hallmark of Trump’s return to the White House, stirred the pot, no question. But isn’t it refreshing to see a leader willing to shake up decades of free-trade dogma to protect American jobs?
Fast forward to the second quarter, and the tide turned dramatically—imports plummeted by 29.3%, boosting GDP growth by over 5 percentage points. Consumer spending also revved up to a 2.5% pace, a leap from the measly 0.6% earlier in the year. That’s the kind of grit we’ve been craving.
Thursday’s report from the Commerce Department, the final look at this period, revised the initial 3% growth estimate upward to 3.8%.
GDP, for those who might not know, measures the nation’s total output of goods and services, and this jump signals a healthier economy than many naysayers predicted.
Economists are even whispering that this momentum might carry into the third quarter, with the Federal Reserve Bank of Atlanta projecting a solid 3.3% growth. Yet, FactSet forecasters are less rosy, expecting a slowdown to 1.5% for July to September. Still, isn’t any growth a win in these turbulent times?
Trump’s tariff strategy—double-digit taxes on imports from nearly every corner of the globe, targeting steel, aluminum, and cars—has flipped the script on decades of U.S. trade policy.
He’s clear: protect American industry, bring factories home, and fund massive tax cuts like the one signed on July 4. Bold moves, even if they’ve left some businesses scratching their heads.
Mainstream economists, predictably, grumble that these tariffs hike costs and dull U.S. competitiveness. Sure, importers foot the bill and often pass it to consumers, but the impact on inflation has been modest so far. Shouldn’t we at least give Trump credit for trying to level the playing field?
The unpredictability of these trade policies has slowed hiring, with job creation stalling after a post-COVID boom of 400,000 jobs per month from 2021 to 2023.
Recent Labor Department revisions slashed earlier job numbers, revealing just 71,000 monthly additions in the year ending March, down further to 53,000 since. It’s a rough patch, but isn’t uncertainty the price of shaking up a broken system?
Wall Street, ever the drama queen, didn’t cheer this GDP news, with the Nasdaq dropping nearly 1% in early trading. Why the cold shoulder to such a robust report? Perhaps the market fears the long-term ripple of trade tensions over short-term gains.
On the labor front, October 3’s report is expected to show a mere 43,000 jobs added in September, though unemployment holds steady at a low 4.3%, per FactSet. That’s hardly a disaster, but it’s clear the hiring engine needs a tune-up amid trade policy fog and the aftershocks of 11 Federal Reserve rate hikes in 2022 and 2023.
Speaking of the Fed, last week’s benchmark interest rate cut—the first since December—might offer some relief, especially as Treasury Secretary Scott Bessent pushes for lower rates. Could this be the spark businesses need to regain confidence?
“This paints a somewhat reassuring picture of the US economy,” said Bret Kenwell, a U.S. investment analyst at eToro, to the Daily Mail. Reassuring, sure, but let’s not pop the champagne yet—growth is great, but only if it’s sustainable beyond tariff-driven swings.
Looking ahead, the Commerce Department will drop its first estimate for July-to-September growth on October 30. Between now and then, let’s hope the consumer resilience and economic momentum keep defying the doubters. After all, isn’t it time America’s backbone—its workers and spenders—got the win they deserve?