The US economy contracted more than expected in the first three months of this year, according to government data. Consumer spending and exports were weaker than expected.

According to the Department of Commerce, US GDP fell by 0.5% year-on-year in the first quarter.

This is less than the earlier estimate of a 0.2% decline and lower than the 2.4% increase in the fourth quarter of last year, AFP reported.

The data came after a sharp increase in imports triggered by the massive tariffs that US President Donald Trump imposed after his return to the White House this year.

Companies had stockpiled goods to get ahead of Trump's tariffs, which target most trading partners, especially goods from China.

Imports are deducted when calculating GDP.

However, this revision mainly reflects “downward revisions to consumer spending and exports,” the Commerce Department said.

This was partly offset by a downward revision to imports, the department added.

Although Trump has withdrawn or postponed some of his most punitive trade tariffs as trade negotiations continue, the deadline for higher tariffs to take effect on dozens of economies is approaching in July, adding to economic uncertainty. | BGNES