US Economy Slips into Negative Growth Amid Tariff Worries
The U.S. economy reported negative GDP growth for the first time since 2022, raising concerns among traders and investors. Markets reacted negatively at the open, with the S&P 500 dropping 1.3% and the NASDAQ falling by 1.8%. Although the underlying economic details remain somewhat stable, the negative headline figure is influencing investor sentiment.
A key factor behind this slowdown is the tension between businesses and the White House over tariffs. Retailers, worried about higher costs from tariffs, have increased imports early, showing significant caution in the business community.
Today, President Trump is meeting with top executives, including Jensen Huang from NVIDIA and leaders from Johnson & Johnson and Eli Lilly. The President intends to highlight ongoing business investments in the U.S., but these same executives have been vocal about the negative impacts higher tariffs could have on their operations.
Traders and investors should closely watch today’s PCE inflation report at 10 a.m. Eastern for market-moving signals. Big tech companies, including Meta, Microsoft, Amazon, and Apple, will also report earnings later this week, creating potential volatility. Additionally, the payrolls report coming up on Friday will provide important insights into employment conditions and the overall economy.
Given this uncertain environment, investors are advised to stay cautious and responsive to tariff-related news and upcoming corporate earnings.
This article was written by Itai Levitan at www.forexlive.com.
