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U.S. President Donald Trump stepped up his calls for an interest rate cut on Wednesday, citing stronger-than-expected annual gross domestic product (GDP) growth of 3% for the second quarter of 2025, released just hours before the Federal Reserve was set to announce its latest policy decision.
“The economy is growing much faster than anyone thought possible,” Trump wrote on his Truth Social platform. “‘Too Late’ MUST NOW LOWER THE RATE.”
Beating the 2.5% forecast compiled by Briefing.com, the second quarter result marked a reversal from the 0.5% contraction recorded in the first quarter.
According to the Bureau of Economic Analysis, the second-quarter rebound was primarily driven by a decrease in imports, which are subtracted in the GDP calculation, and a rise in consumer spending.
The report noted that businesses had ramped up imports at the start of the year in anticipation of higher tariffs under trade policies introduced by the Trump administration in April.
That front-loaded activity distorted first-quarter figures, causing what analysts at Goldman Sachs recently described as the largest negative contribution from net exports on record.
As that inventory buildup subsided in the second quarter, the drag from imports diminished, contributing positively to the GDP calculation.
Despite the strong headline number, some economists cautioned against assuming a durable trend.
While lower imports and resilient consumer demand supported the second-quarter figures, the expected implementation of further tariffs could lead to higher inflation, reducing real household purchasing power.
Analysts indicated that inflationary pressure from new tariffs may weigh on consumption in the coming quarters, potentially slowing the pace of economic expansion.
The GDP data was released shortly before the Federal Open Market Committee was due to announce whether it would adjust the benchmark interest rate, a decision closely watched by markets and policymakers amid competing signals from growth and inflation dynamics.
The Federal Reserve currently holds its benchmark interest rate in a range between 4.25% and 4.50% and is likely to maintain this stance at its meeting, according to a market participants’ survey in CME Group’s FedWatch Tool.
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