CNBC editor Rick Santelli said the U.S. economy is outperforming expectations — despite worries over President Trump’s new tariffs. On Wednesday, Santelli noted the gross domestic product (GDP) rose 3%, higher than the 2.5% economists had projected.
“These are the advance numbers, so revisions will come,” Santelli said on Squawk Box. “But 3%? Last quarter was down half a percent. This is a major turnaround.”
According to the Bureau of Economic Analysis, the spike was driven largely by a drop in imports. That helped push the GDP to its best level since Q3 of 2024, when it hit 3.1%.
Consumer spending also ticked up 1.4%, matching forecasts. That’s the highest since late 2024. But Santelli warned the previous quarter’s spending—just 0.5%—was among the weakest outside of COVID-era shutdowns.
“Last time we saw consumer numbers this soft? June 2011,” Santelli said. “That puts it in rare territory, especially outside of COVID.”
Inflation also showed signs of cooling. The overall pricing index came in at 2%—lower than expected. That’s the lowest since Q3 2024.
But the core PCE price index, which strips out food and energy, was a bit hotter at 2.5%. That’s the highest reading since late 2024, when it was 2.6%.
Trump’s April 2 “Liberation Day” tariffs sparked panic among critics. But the numbers suggest the economy is holding steady—or even improving. Trump paused parts of the plan on April 9 but doubled down on tariffs targeting Chinese goods.
Squawk Box host Joe Kernen pointed out the political spin. “Warren will say inflation’s out of control. But here we are—3% GDP, markets at new highs. The doomsday predictions didn’t happen.” Santelli agreed: “Don’t let a congressman manage your money. That’s the lesson here.”