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      Is Trump driving the US into a recession? – in charts

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      Prospects for the US economy have cooled significantly in a matter of months. After outperforming its international peers last year, warning lights are flashing on a dashboard of economic indicators as analysts warn that Donald Trump’s erratic approach is hitting the world’s largest economy.Fears of a US recession this year are growing, in what is being called a “Trumpcession”, amid a sharp decline in business and consumer confidence as the president threatens punitive import tariffs on US allies and enemies alike.Most economists reckon a recession – defined as two consecutive quarters of shrinking economic output – can be avoided. But it is clear there are storm clouds gathering within the president’s first 100 days back in the White House.GDPUS growth in gross domestic product (GDP) had outpaced international peers in recent years, and since the Covid pandemic in particular – helped by the Biden administration pumping billions of dollars into the economy through the Inflation Reduction Act. The former president did not get much credit, though, as voters felt the squeeze from the period of high inflation triggered by the pandemic and Russia’s war in Ukraine.This week, the Atlanta Federal Reserve’s GDPNow, which measures GDP economic growth in real time, suggested the US economy would contract at an annual rate of 2% in the first quarter. However, this widely followed indicator can be volatile, and it is heavily influenced by the US trade deficit, which soared in January.Trade balanceThe US goods trade gap surged to $153.3bn in January. This was driven by record import volumes, an increase of $36.2bn to $329.5bn in total, as US businesses rushed to bring shipments into the country to avoid potential tariffs.US gold importsA significant driver of the import rise was inbound shipments of “finished metal shapes”, which include bars of gold. The trend is also attributed to traders rushing to get ahead of potential US tariffs. A widening trade deficit would normally weigh on a country’s GDP, because imports are subtracted from the measurement. But because gold bought to sit in a vault is not consumed or used in production, it is excluded.This means the Atlanta Fed is likely to be overestimating the hit to first-quarter GDP. Still, there are other signs that the US economy is cooling.InflationTrump had promised to “bring prices down, starting on day one” and “cut energy costs in half within 12 months after taking office”.Official figures show the headline annual rate as measured by the consumer price index was 2.8% in February, after an unexpected rise to 3% in January from 2.9% in December. Energy costs are down by 0.2% on an annual basis.The Organisation for Economic Co-operation and Development (OECD) said on Monday that Trump’s trade wars risked stoking inflation. It increased its US inflation forecast for 2025 to 2.8%, up from a previous estimate of 2.1% made in December.EmploymentThe US jobs market has boomed in recent years, and the unemployment rate dropped to 3.5% in early 2023, the lowest level since the year of the first moon landing in 1969. The rate has ticked higher in recent months, but remains historically low at 4.1%. This has been spurred by rapid growth in the numbers of jobs being added to the economy.Wage growth has also strengthened, and has remained above inflation since early 2023, helping households to rebuild some of their purchasing power lost during the recent rise in living costs.StocksThe US stock market has powered to record highs in recent years. Tech stocks and the “magnificent seven” – Alphabet, Amazon, Apple, Microsoft, Meta, Nvidia and Tesla – have led the charge in particular, buoyed up by investors betting on the growth of artificial intelligence.The Biden administration oversaw a strong stock market performance, helped by the economic recovery from the pandemic. However, Wall Street surged after Trump’s election victory in November, amid investor expectations for tax cuts that could increase company profits. Markets have been rattled in Trump’s first 100 days amid concerns over his erratic approach to the economy and the threat of tariffs hitting growth and stoking inflation.The US dollarThe US dollar had been rising sharply against other leading currencies, reflecting the strength of the economy and investor concerns that Trump’s policies could stoke inflation. Tariffs pushing up the price of imported goods, driving up inflation, could force the US Federal Reserve to hold back from cutting interest rates.With inflation having fallen back, the Fed cut its benchmark rate last year by a whole percentage point – from a range between 5.25% and 5% to between 4.25% and 4.5%. Higher inflation could limit its capacity for further rate cuts.A dramatically slowing economy could force the central bank to take action to lower borrowing costs. This has led to a pullback in the dollar in recent weeks.Washington has long held a “strong dollar” policy in the view that it supports the purchasing power of US consumers, helping to keep inflation low. The dollar is also used as the currency of choice for world trade and underpins the financial system. The US Treasury secretary, Scott Bessent, has said this approach is not changing. But Trump has argued that a weaker dollar would benefit US manufacturing by making exports cheaper for overseas buyers.Prices of inputs for manufactured productsBusiness surveys have shown a marked increase in input costs for US manufacturers, providing an early warning sign for growth and inflation. The price gauge on the Institute for Supply Management (ISM) manufacturing purchasing managers’ index (PMI) shows raw material costs rose sharply at the start of this year, in the first signs of supplier difficulties and discussions about who will pay for tariffs. The rise in input costs could dent US manufacturing output, and is likely to be passed on to consumers in the form of higher prices for finished goods.Consumer spendingUS consumer spending unexpectedly dropped in January for the first time in almost two years, with a fall of 0.2%, the biggest decrease in nearly four years. Cold temperatures in some parts of the country, as well as wildfires in California, were likely to have hit spending. However, some analysts warn consumer sentiment has taken a knock amid mounting concern over the strength of the economy. More

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      Trump says the economy ‘went to hell’ under Biden. The opposite is true

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      Donald Trump keeps saying he inherited a terrible economy from Joe Biden and many Americans believe him, even though that’s not true. During his White House marketing event for Tesla on Tuesday, Trump said the US and its economy “went to hell” under Biden. Last week, in his national address to Congress, Trump said: “We inherited from the last administration an economic catastrophe and an inflation nightmare.”But the truth is that by standard economic measures, the US economy was in excellent shape when Biden turned over the White House keys to Trump, even though most Americans, upset about inflation, told pollsters the economy was in poor shape.When Biden left office, the unemployment rate was a low 4.1%, and during Biden’s four years in office, the average jobless rate was lower than for any president since the 1960s. Trump has repeatedly railed against the high inflation under Biden, but the fact is that by the time Biden left office, the inflation rate had fallen to just 2.9% – down more than two-thirds from its peak and near the Federal Reserve’s inflation goal.Not only that, the nation’s GDP growth has been impressive, rising at a solid 3.1% rate at the end of Biden’s term. Ever since the pandemic ended, economic growth in the US has been considerably stronger than in the UK, France, Germany and other G7 nations. Shortly before election day, the Economist magazine ran a story saying the US economy was “the envy of the world” and had “left other rich countries in the dust”.Trump often says job growth under Biden was terrible, but the fact is that the US added 16.6m jobs during Biden’s presidency, more than during any four-year term of any previous US president. Under Trump, job growth was far worse – during his first four-year term, the nation lost 2.7m jobs overall, making Trump’s presidency the first since Herbert Hoover’s during which the nation suffered a net loss in jobs. The pandemic was largely responsible for this, but even during Trump’s first three years in office, before the pandemic hit, job growth was only half as fast as it was under Biden.Recently, Trump has repeatedly boasted how his tariffs will bring back manufacturing. Trump fails to note, however, that Biden had considerable success in bringing bring back manufacturing and factory jobs. Under most recent presidents, the US lost manufacturing jobs, but under Biden, the nation gained an impressive 750,000 factory jobs, the most under any president since the 1970s. A big reason for this was that as a result of Biden’s green jobs legislation and the Chips Act to boost semiconductor production, manufacturing investment boomed, more than doubling during Biden’s four years in office.Biden took considerable pride about how the economy performed under him, even though he failed to persuade most Americans that the it was doing well. In December, Biden wrote: “Incomes are up by nearly $4,000 adjusted for inflation [since he took office], and unions have won wage increases from 25% to 60% in industries like autos, ports, aerospace, and trucking. We’ve seen 20 million applications to start small businesses. Our economy has grown 3% per year on average the last four years – faster than any other advanced economy. Domestic energy production is at a record high.”Many economists vigorously disagree with Trump’s claim that he inherited a poor economy. Paul Krugman wrote that in January, when Biden left office, the US had what was “very close to a Goldilocks economy, in which everything is more or less just right”. Mark Zandi, chief economist at Moody’s Analytics, had even more glowing words. “President Trump is inheriting an economy that is about as good as it ever gets,” he said. “The US economy is the envy of the rest of the world, as it is the only significant economy that is growing more quickly post-pandemic than pre-pandemic.”Trump pays attention to one measure of the economy above all others: how the stock market is doing. During Biden’s four years, Wall Street did very well. The Dow Jones Industrial Average rose by 39% and the S&P 500 soared by 55.7%, including a 28% jump during 2024. In contrast, the stock market is down overall since Trump took office as investors have grown alarmed about the president’s tariff war against the US’s trading partners.skip past newsletter promotionafter newsletter promotionTo be sure, there were some serious economic problems under Biden. Housing affordability was a major problem, and inflation rose to uncomfortable levels. The spike in prices was caused largely by two factors: the pandemic, which gave rise to worldwide supply chain problems, and Putin’s war in Ukraine, which pushed up food and fuel prices. But Trump, in denouncing Biden on inflation, ignores all that.As Trump’s trade war spooks the markets and makes nervous CEOs rethink their investment plans, many economists are saying it’s more and more likely the US will stumble into recession this year.Trump has a long history of refusing to accept blame for mistakes and problems, and by repeatedly claiming he inherited a horrible economy, he seems to be laying the groundwork to blame Biden if the country slides into a painful recession. More

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      ACLU warns pro-Palestinian activist’s arrest meant ‘to intimidate and chill speech’ – live

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      The Trump administration’s decision to have immigration authorities arrest pro-Palestinian activist Mahmoud Khalil for alleged support of Hamas is an attack on free speech, the American Civil Liberties Union warned.“This arrest is unprecedented, illegal, and un-American,” said Ben Wizner, director of the American Civil Liberties Union’s Speech, Privacy, and Technology Project.“The federal government is claiming the authority to deport people with deep ties to the U.S. and revoke their green cards for advocating positions that the government opposes. To be clear: the first amendment protects everyone in the US. The government’s actions are obviously intended to intimidate and chill speech on one side of a public debate. The government must immediately return Mr Khalil to New York, release him back to his family and reverse course on this discriminatory policy.”House minority leader Hakeem Jeffries rejected Republicans’ go-it-alone strategy to avert a government shutdown, saying Democrats would not back their plan to fund federal agencies through the rest of the fiscal year.“It is not something we could ever support,” Jeffries told reporters on Capitol Hill. “House Democrats will not be complicit in the Republican effort to hurt the American people.”“The House Republican so-called spending bill does nothing to protect Social Security, Medicare and Medicaid. Quite the opposite,” he said, adding that the bill would “quite dramatically” cut health benefits and nutritional assistance programs for children and American families.Jeffries did not take questions and it remains unclear whether any House Democrats will support the GOP spending bill, which could come up for a vote as early as Tuesday. House Republicans hold a wafer-thin majority and can only afford to lose a handful of votes in order to pass the measure.Congress must act by midnight on Friday to avoid a partial government shutdown.Los Angeles district attorney Nathan Hochman says that he opposes the resentencing of Lyle and Erik Menendez, who were convicted for the 1989 killing of their parents, Jose and Kitty Menendez. In a press release on Monday, Hochman’s office said that after reviewing thousands of pages of records and transcripts and hundreds of hours of video, he found that the brothers lied during their testimony and tried to get others to lie on their behalf.
      As a full examination of the record reveals, the Menendez brothers have never come clean and admitted that they lied about their self-defense…“The Court must consider such lack of full insight and lack of acceptance of responsibility for their murderous actions in deciding whether the Menendez brothers pose an unreasonable risk of danger to the community,” Hochman said in a statement.
      The brothers were sentenced for the killings in 1996 and sentenced to life sentences without the possibility of parole.Read the rest of Hochman’s rationale here.Protests are underway in New York following the arrest of Mahmoud Khalil, a Palestinian activist who helped lead Columbia University’s pro-Palestinian protests last year. Khalil, a permanent US resident with a green card who is a recent Columbia graduate, was arrested over the weekend by immigration authorities.Today’s final numbers from Wall Street are out and the three main indices have continued to drop. The S&P 500 fell 2.7%, the Dow Jones dropped 2%, and the tech-heavy Nasdaq dropped 4% as investors sold shares in the so-called “magnificent seven” – Alphabet, Amazon, Apple, Microsoft, Meta, Nvidia and Tesla. Tesla’s shares had their worst day since September 2020, falling 15%.The fall came a day after Trump skirted around questions about a potential recession on Sunday. Asked if he expected a recession, Trump said: “There is a period of transition, because what we’re doing is very big … It takes a little time, but I think it should be great for us.”Kevin Hassett, the head of the national economic council, told CNBC on Monday that any uncertainty around Trump’s trade policies would be resolved by early April and that the policies were “creating jobs in the US”.We’re about 10 minutes away from the market’s close and things are not looking good on Wall Street.Traders have been rattled for days by fears that Donald Trump’s tariffs against China, Canada and Mexico, and vow to impose “reciprocal” levies against countries worldwide next month, will send the US economy into recession.The terror has been particularly bad today, leading to steep sell offs in the three main indices. The broad-based S&P 500 is currently down 2.5%, while the benchmark Dow Jones Industrial Average has lost 1.9%. Over at the tech-heavy Nasdaq, the bleeding has resulted in a 4% loss.Needless to say, this is not what a president who touts the stock market as a barometer of their economic success would like to see.National intelligence director Tulsi Gabbard has announced that she has revoked the security clearances of several former members of Joe Biden’s administration, as well as critics of Donald Trump.“Per @POTUS directive, I have revoked security clearances and barred access to classified information for Antony Blinken, Jake Sullivan, Lisa Monaco, Mark Zaid, Norman Eisen, Letitia James, Alvin Bragg, and Andrew Weissman, along with the 51 signers of the Hunter Biden ‘disinformation’ letter. The President’s Daily Brief is no longer being provided to former President Biden,” Gabbard wrote on X.The decision to revoke the security clearance of Blinken, the former secretary of state, appears to have been announced last month. Trump earlier withdrew the clearances of Biden and former joint chiefs of staff chairman Mark Milley.Beyond the Biden administration, Gabbard targeted James, who has pursued a civil fraud suit against the Trump Organization, and Manhattan district attorney Bragg, who successfully prosecuted the president on felony business fraud charges.A former top social security administration official accused Elon Musk’s “department of government efficiency” of lying about alleged fraud discovered in the agency, the Guardian’s Martin Pengelly reports:A former chief of staff at the US Social Security Administration (SSA) described how agents of the so-called “department of government efficiency” (Doge) – Elon Musk’s government cost-cutting operation – were imposed on the agency, assailing senior staff with questions “based on the general myth of supposed widespread fraud” and acting with dangerous disregard for data confidentiality.In a declaration filed with a lawsuit on Friday and referring to the Doge agents Mike Russo and Akash Bobba, Tiffany Flick said: “We proposed briefings to help Mr Russo and Mr Bobba understand the many measures the agency takes to help ensure the accuracy of benefit payments, including those measures that help ensure we are not paying benefits to deceased individuals.“However, Mr Russo seemed completely focused on questions … based on the general myth of supposed widespread social security fraud, rather than facts.”Flick also said she was “not confident” Doge agents had “the requisite knowledge and training to prevent sensitive information from being inadvertently transferred to bad actors”, given its agents have “never been vetted by SSA or trained on SSA data, systems or programs”.“In such a chaotic environment, the risk of data leaking into the wrong hands is significant,” Flick said.The Trump administration’s decision to have immigration authorities arrest pro-Palestinian activist Mahmoud Khalil for alleged support of Hamas is an attack on free speech, the American Civil Liberties Union warned.“This arrest is unprecedented, illegal, and un-American,” said Ben Wizner, director of the American Civil Liberties Union’s Speech, Privacy, and Technology Project.“The federal government is claiming the authority to deport people with deep ties to the U.S. and revoke their green cards for advocating positions that the government opposes. To be clear: the first amendment protects everyone in the US. The government’s actions are obviously intended to intimidate and chill speech on one side of a public debate. The government must immediately return Mr Khalil to New York, release him back to his family and reverse course on this discriminatory policy.”Activists were arrested while disrupting the CERAWeek fossil fuel conference on Monday, chanting “people over profit”.The protesters blocked the street outside the conference hotel in Houston, where energy secretary Chris Wright and top brass from energy companies including Shell and Exxon spoke on Monday.Among those arrested was local organizer Yvette Arellano of Texas environmental justice group Fenceline Watch.“Human rights, not sacrifice,” she chanted as the police escorted her away.As the CERAWeek oil and gas conference convened fossil fuel bigwigs in Houston on Monday, hundreds of activists staged a protest down the street.“We need clean air, not another billionaire,” they chanted.Among the featured speakers at the rally was Yvette Arellano, founder and director of Fenceline Watch, a Houston-based environmental justice organization. Last year, she was barred from attending CERAWeek despite raising $8,500 for a ticket.“Unfettered” fossil fuel expansion, she said, is taking a toll on the climate while polluting vulnerable communities in Texas and beyond.“It’s our communities that are being harmed,” she said.Other activists hail from communities as far flung as Appalachia and the Standing Rock Indigenous reservation in North Dakota.A story to watch this week is Congress’s scramble to pass spending legislation and avert a shutdown that will begin Friday at midnight. These things often come down to the wire, but the Guardian’s Joseph Gedeon reports that Donald Trump is on board with the House GOP’s proposal to keep the government open. Whether enough of their lawmakers are remains to be seen:Republican lawmakers are scrambling to avert a government shutdown set to begin on Saturday, with Donald Trump’s backing for a temporary funding measure having suddenly silenced the usual conservative opposition.The stopgap funding bill, known as a continuing resolution (CR), would maintain government operations at current funding levels through 30 September, the end of the fiscal year. Republican US House speaker Mike Johnson said he plans to hold a procedural vote on Monday, aiming for a passage vote on Tuesday before sending lawmakers home for recess.Trump instructed reluctant fellow Republicans to fall in line behind the stopgap bill that would fund the government through September. “All Republicans should vote (Please!) YES next week,” the president wrote on Saturday on his Truth Social platform.Maryam Alwan, a Palestinian American senior at Columbia who has protested alongside Mahmoud Khalil, told Reuters she was “horrified for my dear friend Mahmoud, who is a legal resident, and I am horrified that this is only the beginning”.Columbia issued a revised protocol for how students and school staff should deal with federal immigration agents seeking to enter private school property, Reuters reports, saying they could enter without a judicial arrest warrant in “exigent circumstances”, which it did not specify.“By allowing ICE on campus, Columbia is surrendering to the Trump administration’s assault on universities across the country and sacrificing international students to protect its finances,” the Student Workers of Columbia said in a statement.The move to arrest and detain Palestinian student activist Mahmoud Khalil comes after the Trump administration announced last week that it would revoke about $400m in federal grants and contracts from Columbia University.The Trump administration alleges that the university has not done enough to stop antisemitism on campus.“Universities must comply with all federal antidiscrimination laws if they are going to receive federal funding. For too long, Columbia has abandoned that obligation to Jewish students studying on its campus,” education secretary Linda McMahon said in a statement on Friday.Mahmoud Khalil’s arrest is the first publicly known deportation effort under Trump’s promised crackdown on students who joined protests against the war in Gaza that swept college campuses last spring, the Associated Press reported Sunday.The Trump administration has claimed participants forfeited their rights to remain in the country by supporting Hamas.Before Trump addressed Mahmoud Khalil’s arrest, free speech organizations and advocates are expressing outrage over his detention over the weekend.Khalil, a permanent US resident with a green card, was taken into custody by federal immigration authorities on Saturday night, who reportedly said that they were acting on a state department order to revoke his green card.Read the full story:In a post on Truth Social, president Donald Trump confirmed the arrest of Mahmoud Khalil, a prominent Palestinian activist and permanent US resident with a green card.“This is the first arrest of many to come,” Trump said.The president said Ice took Khalil, who led protests at Columbia University during his time as a student there, into custody after his executive order and claimed, without evidence, that similar activists on college campuses are paid agitators, not students.Here’s the text of Trump’s full post:
      Following my previously signed Executive Orders, ICE proudly apprehended and detained Mahmoud Khalil, a Radical Foreign Pro-Hamas Student on the campus of Columbia University. This is the first arrest of many to come. We know there are more students at Columbia and other Universities across the Country who have engaged in pro-terrorist, anti-Semitic, anti-American activity, and the Trump Administration will not tolerate it. Many are not students, they are paid agitators. We will find, apprehend, and deport these terrorist sympathizers from our country — never to return again. If you support terrorism, including the slaughtering of innocent men, women, and children, your presence is contrary to our national and foreign policy interests, and you are not welcome here. We expect every one of America’s Colleges and Universities to comply. Thank you!
      Ontario premier Doug Ford announced a 25% tax on exports of electricity to New York, Minnesota and Michigan in retaliation for the tariffs Donald Trump imposed on Canada last week, the Associated Press reports.Trump has since exempted many Canadian products from the 25% levies, but Ford refused to back down and warned he may increase the surcharge or even cut off electricity exports entirely if the United States escalates its tariffs.Here’s more, from the AP:
      “I will not hesitate to increase this charge. If the United State escalates, I will not hesitate to shut the electricity off completely,” Ontario Premier Doug Ford said at a news conference in Toronto.
      “Believe me when I say I do not want to do this. I feel terrible for the American people who didn’t start this trade war. It’s one person who is responsible, it’s President Trump.”
      Ford said Ontario’s tariff would remain in place despite the one-month reprieve from Trump, noting a one-month pause means nothing but more uncertainty. Quebec is also considering taking similar measures with electricity exports to the U.S.
      Ford’s office said the new market rules require any generator selling electricity to the U.S. to add a 25% surcharge. Ontario’s government expects it to generate revenue of $300,000 Canadian dollars ($208,000) to CA$400,000 ($277,000) per day, “which will be used to support Ontario workers, families and businesses.”
      The new surcharge is in addition to the federal government’s initial CA$30 billion ($21 billion) worth of retaliatory tariffs have been applied on items like American orange juice, peanut butter, coffee, appliances, footwear, cosmetics, motorcycles and certain pulp and paper products.
      Secretary of state Marco Rubio announced that USAid had cancelled the majority of its programs, while the rest will be folded into the state department. The decision was reportedly made early, and after many of the shuttered aid agency’s partners believed they had more time to request to preserve their programs. It was also met with approval from Elon Musk, after reports emerged last week that he squabbled with Rubio at a cabinet meeting attended by Donald Trump. Meanwhile, the arrest of pro-Palestinian activist and US green card holder Mahmoud Khalil by immigration agents has sparked concerns that the Trump administration is looking to retaliate against speech it does not approve of. The homeland security department said Khalil’s detention was in line with an executive order targeting “activities aligned to Hamas”.Here’s what else has happened today so far:

      Wall Street fell significantly as traders grew concerned over the possibility that Trump’s trade war will send the US economy into a recession.

      A top state department official has a history of insulting his boss in social media posts, among many other questionable statements.

      Trump will sign more executive orders at 3pm, though the White House did not say what they will concern. More

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      ‘I hate to predict things’: Trump doesn’t rule out US recession amid trade tariffs

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      Donald Trump on Sunday refused to rule out the possibility that the US economy will head into recession this year and that inflation will rise, as his chaotic trade tariffs policy cause uncertainty and market turbulence.The US president predicted that his economic goals would take time and a period of transition to bear fruit. But when asked in an interview with the Fox News show Sunday Morning Futures “are you expecting a recession this year?” he demurred.“I hate to predict things like that. There is a period of transition, because what we’re doing is very big. We’re bringing wealth back to America. That’s a big thing. And there are always periods of, it takes a little time. It takes a little time, but I think it should be great for us,” Trump said.When asked whether he thought his tariffs on US imports would fuel inflation, he said: “You may get it. In the meantime, guess what? Interest rates are down.”He downplayed recent stock market volatility that followed his ducking and weaving over tariff policy on exports from Canada, Mexico and China and similar threats to other countries, despite his usual fixation with market performance in relation to the politics of the day and an appetite to claim credit when stocks rise on his watch.“You have to do what’s right,” he said.Last week the Atlanta Federal Reserve suggested that the US economy is on course to contract in the first quarter, triggering fears a recession could hit the world’s largest economy if weakness persisted and fueling stock market jitters.In 2018 Trump posted on Twitter, now X, that “trade wars are good, and easy to win”, a view that is not widely shared by financial and economic experts.On Sunday, however, he was cautious overall after boasting throughout his election campaign of the swift gains his policies would bring for the US economy and ordinary Americans’ finances.Fox News Sunday Morning Futures anchor Maria Bartiromo introduced the topic of recession by telling Trump “look, I know you inherited a mess”, even though most experts agree that predecessor Joe Biden, a Democrat, left the Republican president a stable economy where inflation, although painfully high for a long time, was continuing to come down and international trading conditions for the US were steady.Meanwhile, also on Sunday morning, NBC’s Meet the Press TV politics show was interviewing US commerce secretary Howard Lutnick.He pushed back on concerns that the prospect of Trump’s global tariffs would cause a recession in the US. “Absolutely not,” he said. “There’s going to be no recession in America.”Lutnick added: “Anybody who bets against Donald Trump, it’s like the same people who thought Donald Trump wasn’t going to win a year ago … you are going to see over the next two years the greatest set of growth coming from America … I would never bet on recession, no chance.”

      Reuters contributed reporting More

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      Trump temporarily spares carmakers from US tariffs on goods from Canada and Mexico

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      Donald Trump has temporarily spared carmakers from sweeping US tariffs on goods from Canada and Mexico, one day after an economic strike on the US’s two biggest trading partners sparked warnings of widespread price increases and disruption.The US president extended his aggressive trade strategy at midnight on Tuesday by targeting the country’s two closest neighbors with duties of 25%.US retail giants predicted that prices were “highly likely” to start rising on store shelves almost immediately, raising questions about Trump’s promises to “make America affordable again” after years of heightened inflation.After a call with top executives at General Motors, Ford and Stellantis, however, Trump approved a one-month exemption from tariffs on “any autos coming through” the US, Mexico and Canada, the White House press secretary, Karoline Leavitt, announced on Wednesday.The exemption has been granted “at the request of the companies”, Leavitt told reporters, “so they are not at an economic disadvantage”.While Trump has claimed tariffs will embolden US industry by forcing global firms to build factories in the US, Ford CEO Jim Farley publicly cautioned last month that imposing steep tariffs on Canada and Mexico could “blow a hole” in the country’s auto industry.Shares in large carmakers rose sharply, with GM up 7.2%, Ford up 5.8% and Stellantis up 9% in New York. The benchmark S&P 500 increased 1.1% on Wall Street.A separate call between Trump and Justin Trudeau, the Canadian prime minister, did not lead to any larger breakthrough, however. Trudeau “largely caused the problems we have with them because of his Weak Border Policies”, Trump declared on his Truth Social platform after they spoke. “These Policies are responsible for the death of many people!”Trudeau insisted there had been improvements at the border, the US president claimed, adding that he told him this was “not good enough”.During Trump’s joint address to Congress on Tuesday evening, he acknowledged that tariffs would cause disruption. There will be “a little disturbance, but we’re OK with that”, he said.He blamed cost of living challenges on his predecessor, Joe Biden, from whom he claimed to have inherited “an economic catastrophe and an inflation nightmare”.The US economy has, in fact, remained resilient in recent years, and inflation has fallen dramatically from its peak – at the highest level in a generation – three years ago.“Among my very highest priorities is to rescue our economy and get dramatic and immediate relief to working families,” said Trump. “As president, I am fighting every day to reverse this damage and make America affordable again.”skip past newsletter promotionafter newsletter promotionTrump spoke on Wednesday with Trudeau. “Even though you’re a very smart guy, this is a very dumb thing to do,” Trudeau told Trump publicly after the US imposed tariffs this week.Trump had initially pledged to target Canada and Mexico with tariffs on his first day back in office. Upon his return, however, he said he was considering imposing the tariffs at the start of February. Last month, he offered Canada and Mexico a one-month delay at the 11th hour.Trump and his allies claim that higher tariffs on US imports from across the world will help “Make America great again”, by enabling it to obtain political and economic concessions from allies and rivals on the global stage.But businesses, both inside the US and worldwide, have warned of widespread disruption if the Trump administration pushes ahead with this strategy.Since winning November’s presidential election, the president has focused on China, Canada and Mexico, threatening the three markets with steep duties on their exports unless they reduced the “unacceptable” levels of illegal drugs crossing into the US. More

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      As Republicans thunderously applauded and Democrats walked out in droves, Trump’s Congress speech showcased the US divide | Lloyd Green

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      Donald Trump is busy while the world around him is mired in chaos. Six weeks into his second term, he has reversed the course of US policy towards Ukraine, imposed tariffs on China, Canada and Mexico, and delegated the task of slashing government to Elon Musk. The stock market swoons.Recession and stagflation are no longer hypotheticals. The term “trade war” fills the headlines. The Dow sits hundreds of points below where it stood on Inauguration Day. Trump’s second term is already consequential and controversial.In the opening words of his speech to a joint session of Congress, he proclaimed that America was back, that the country’s golden age lay ahead, and that “momentum” had returned. He spoke for nearly two hours, the longest speech to Congress ever. Trump was nakedly partisan, the reception in the House chamber was raucous.Republicans thunderously applauded while Democrats delivered a chorus of catcalls. Early on, Speaker Mike Johnson demanded order, and called the sergeant-at-arms to remove Al Green, a Texas Democrat, from the hall. Democrats walked out in droves. The speech showcased the American divide.Throughout the night, Trump made Joe Biden his foil and punching bag. He labeled his predecessor the worst president in American history, lambasting his policies a disaster. Trump also took congressional Democrats to task for their refusal to stand or applaud during his speech. He continues to yearn for adulation.On that note, he compared himself as second to only George Washington, the first president. As ever, self-deprecation and modesty were nowhere to be found.Immigration and social issues policy took pride of place. Here, the speech sounded like a continuation of the fall campaign. Trump pointed to quiet at the southern border and read a laundry list of changes implemented by his administration.He bragged of making English the official language of the US, abolishing DEI in and out of government, and barring transgender athletes from competing in women’s sports. Said differently, his campaign slogan, “Kamala is for they/them, President Trump is for you”, continues to retain its salience.Trump remains a culture warrior, a tack that twice led him to the White House. Throughout the evening, he returned to immigration as a rhetorical touchstone. He also attacked street gangs, urban crime and street violence. For the Democrats to regain competitive political footing, they will need to reconcile themselves to the reality that mass immigration is unpopular, that being tough on crime is a winner, and that the language of “wokeness” goes no further than the faculty lounge.Past demands to defund the police will likely haunt the party for the foreseeable future. The fact that Trump repeated his call for an immigration gold card, with citizenship sold to Russian oligarchs at $5m a pop, does not detract from the potency of immigration as an issue.By the numbers, nearly half the US supports building a wall along the entire US-Mexico border. At the same time, support for conferring legal status to undocumented or illegal immigrants brought to the US as children declines.As to be expected, Trump ignored the stock market drop and instead pointed to a decline of interest rates. Whether the latter is a harbinger of a decline in inflation, a slowing economy, or both, remains to be seen. He repeated his call to “drill, baby, drill”. He also gave Elon Musk, his largest campaign donor and the head of Doge, star treatment and a shout-out.Foreign policy occupied little space. Trump repeated his threat toward Denmark over Greenland. “I think we’re going to get it – one way or the other, we’re going to get it.” He again staked a US claim to Panama. Ukraine came late, almost as an afterthought.Despite market turmoil, “tariffs” remained a beautiful word in the Trumpian lexicon. On Tuesday night, he announced that US-imposed reciprocal tariffs will kick in on 2 April, less than a month away. Much can go wrong between now and then.The possibility of averting a trade war does not appear to have lessened during the course of the speech. He said tariffs are about the “soul” of the country while acknowledging that they may bring temporary dislocation. Still, he didn’t seem all that bothered.The speech won’t unite a nation, but it will rally the Republican base. More