The GDP report included more evidence that the U.S. was plagued by an investment recession as well as a manufacturing one last year. Gross private domestic investment fell 1.9% in the fourth quarter from a year earlier, while investment in non-residential structures fell 7% and equipment was down 1.5%.

Kevin Cummins, senior U.S. economist at NatWest Markets, said the slump in imports also appeared to reflect weaker consumer demand, one of the big drivers of the U.S. economy traditionally. “If consumption is weakening, you’re going to have weaker imports, which ironically, should be a net positive for top-line GDP,” he said. “But I think it’s a sign of weaker consumer demand more than anything else.”

Some economists argue that Trump’s signing of a “phase-one” deal should lift the real economy in 2020, just as it has financial markets. That agreement, though, has left tariffs in place on $370 billion in imports from China that are still likely to be a drag on growth and even the Federal Reserve is holding off judgment.

U.S. Federal Reserve Chairman Jerome Powell on Wednesday warned that “trade policy uncertainty remains elevated” and that his conversations with contacts in the business world showed they were still adopting a “wait and see attitude”.

Other close observers of the U.S. economy also still think that Trump’s trade policies will be a drag on growth this year. In forecasts released this week, the Congressional Budget Office said it expected the tariffs on China and other trading partners introduced by the Trump administration to take 0.5% off growth in 2020.

--With assistance from Vince Golle.

This article was provided by Bloomberg News.

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