Donald Trump trader adviser Peter Navarro dismissed concerns about the unexpected drop in the U.S. gross domestic product (GDP) last quarter, saying it is actually a good thing.
The Commerce Department reported Wednesday that the U.S. economy shrunk at a 0.3% annualized pace in the first quarter of 2025. It’s the first drop in three years and is largely due to Trump’s trade wars with nearly every country disrupting business.
The 0.3 percent contraction is a sharp decline from the 2.4 percent expansion recorded in the final full quarter of President Joe Biden’s presidency.
Stocks tumbled after the numbers were released Wednesday. The Dow Jones slid 400 points at the opening bell, the S&P 500 dropped 1.5% and the Nasdaq composite fell 2%.
In an appearance on CNBC, Navarro argued that the economy is in good shape right now were it not for the tariffs.
“I got to say just one thing about today’s news. That’s the best negative print I have ever seen in my life,” Navarro said. “The markets need to look beneath the surface of that.”
“We had a 22% increase in domestic investment,” he continued. “That is off the charts when you strip out inventories and the negative effects of the surge in imports because of the tariffs. You had 3% growth. So we really like where we’re at now.”
