US Manufacturing, GDP Growth Exceed Expectations Amid Trade Uncertainty

The U.S. economy showed a surprising rebound in the second quarter of 2025, growing at an annual rate of around 2.5 to 3 percent after a contraction in the first quarter. This recovery was largely influenced by reduced imports and increased exports due to businesses stockpiling foreign goods ahead of President Donald Trump's tariffs, which has complicated the true assessment of economic health. Despite this growth, underlying indicators point to weaknesses such as a significant drop in private investment, slowing consumer spending, and a decrease in inventories. Economists warn that tariff-related uncertainties and trade war impacts are weighing heavily on businesses and consumers, masking slower economic momentum and increased caution about the future. Consumer confidence is declining amid fears of rising prices and job insecurity, even though the unemployment rate remains low. Overall, while headline GDP numbers suggest strength, experts note an undercurrent of economic unease and stress beneath the surface.