WASHINGTON (AP) — The nation’s economy shrank at a 0.5 percent annual pace from January, according to a new report from the Commerce Department.

First-quarter growth was weighed down by a surge of imports as American companies, and households, rushed to buy foreign goods before President Donald Trump could impose tariffs on them, the report noted.

The Commerce Department previously estimated that the economy fell 0.2 percent in the first quarter. Economists had forecast no change in the department’s third and final estimate.

Economists say the first-quarter import influx likely won’t be repeated in the April-June quarter and therefore shouldn’t weigh on the gross domestic product.

Some economists expect second-quarter growth to bounce back to 3 percent in the second quarter, according to a survey of forecasters by the data firm FactSet.

The January-March drop in gross domestic product — the nation’s output of goods and services — reversed a 2.4 percent increase in the last three months of 2024 and marked the first time in three years that the economy contracted.

Imports expanded 37.9 percent, the fastest rate since 2020, and pushed the GDP down by nearly 4.7 percentage points.

Consumer spending also slowed, expanding 0.5 percent, down from 4 percent in the fourth-quarter of last year. It is a downgrade from the Commerce Department’s previous estimate.

The Conference Board last week reported that Americans’ view of the economy worsened in June, resuming a downward slide that had dragged consumer confidence in April to its lowest level since the COVID-19 pandemic five years ago.

The Conference Board said that its consumer confidence index slid to 93 in June, down 5.4 points from 98.4 last month.

A measure of Americans’ short-term expectations for their income, business conditions and the job market fell 4.6 points to 69. That’s below 80, the marker that can signal a recession ahead.

A category within the GDP data that measures the economy’s underlying strength rose at a 1.9 percent annual rate from January through March, which is down from 2.9 percent in the fourth quarter of 2024 and from the Commerce Department’s previous estimate of 2.5 percent January-March growth.

That category includes consumer spending and private investment but excludes volatile items such as exports, inventories and government spending.

Ryan Sweet of Oxford Economics called the downgrade in that figure “troubling,” though he doesn’t expect to make a significant change to his near-term economic forecast.

Federal government spending also fell at a 4.6 percent annual pace, the biggest drop since 2022.

Economists say trade deficits reduce the GDP, but that’s just a matter of mathematics.

The GDP is supposed to count only what’s produced domestically, not stuff that comes in from abroad. So imports — which show up in the GDP report as consumer spending or business investment — have to be subtracted to keep them from artificially inflating domestic production.

The first look at April-June GDP growth is due July 30.