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U.S. Economy Shows Signs of Strain From Trump’s Tariffs and Spending Cuts


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Posted
. 27, 2025, 5:02 a.m. ET
The United States economy is starting to show signs of strain as President Trump’s abrupt moves to shrink federal spending, lay off government workers and impose tariffs on America’s largest trading partners rattle businesses and reverberate across states and cities.
Funding freezes and firings of federal workers combined with the prospect of costly trade wars are souring consumer sentiment, raising inflation expectations and stalling business investment plans, according to recent economic surveys.
Local economies are also bracing for a sudden withdrawal of fiscal support, forcing officials to contemplate tax increases or municipal bond offerings to stabilize their budgets. 
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