This column is from Trendlines, my business newsletter that covers the forces shaping the economy in Boston and beyond. If you’d like to receive it via email on Mondays and Thursdays, sign up here.

The spike in economic optimism that accompanied Donald Trump’s return to the White House is quickly giving way to jitters.

US stocks had their worst day of the year on Monday after the president confirmed that he would impose new tariffs on Canada and Mexico starting Tuesday. Trump will also double the tariff he placed on all Chinese imports last month.

The news was the latest to unsettle Wall Street and Main Street, where concerns are growing that the new administration’s untested economic agenda will stoke inflation and slow growth. Last week:

• The government reported that personal spending fell in January as inflation remained elevated, while private surveys registered a drop in consumer confidence.
• A widely watched Federal Reserve Bank of Atlanta tracking model indicated the economy would shrink in the first three months of the year. If the prediction bears out, it would mark the first contraction since the start of 2022.
• Analysts resurrected the spectre of “stagflation” — the combination of meager economic growth and hefty price increases that made much of the 1970s pretty miserable.

Some souring of sentiment is understandable. Trump’s economic game plan is a sharp break with the past.

There are cracks in the economy — there always are — but the foundation remains solid.

The latest: Consumers retreated in January, reducing spending by the most in almost four years, the Commerce Department said on Friday.

• The 0.5 percent drop in inflation-adjusted personal outlays from the previous month followed healthy increases in November and December.
• The Personal Consumption Expenditures index, the Federal Reserve’s preferred inflation gauge, rose an annual 2.5 percent in the first month of the year, well above the central bank’s 2 percent target, according to the report.
• Surveys released last week showed declines in consumer confidence and business expansion.

Though bad weather might have affected purchasing, consumer confidence “took large negative hits in January and February, as households have become shell-shocked by a quantum leap in economic policy uncertainty,” said Boston College economist Brian Bethune.

Underscoring the rising uneasiness: The stock market in February gave back a chunk of the gains made since the November election. The selling continued on Monday, with the Standard & Poor’s 500 index shedding 1.8 percent and the tech-heavy Nasdaq losing 2.2 percent.

Yields on the 10-year Treasury, a benchmark for investors’ views on the economy, have fallen on expectations that further weakening could nudge the Fed to cut interest rates.

Why it matters: Trump retook the White House with promises to rev up the economy. He said he’d cut taxes, regulations, and the twin budget and trade deficits while boosting energy production and bringing down prices.

Although the budget resolution approved by the Republican-controlled House last week aims to lower taxes by $4.5 trillion over 10 years, it would reduce spending by only about $1.5 trillion.

GOP lawmakers are weighing $880 billion in cuts to Medicaid, the health insurance program for the poor. But even more draconian cuts to the budget are needed to actually shrink the deficit. It would be hard for the economy to expand if the government goes into austerity mode.

Behind the numbers: Analysts blame the gloomier outlook mainly on worries that tariffs on the country’s biggest trading partners will lead to a trade war that increases prices and hurts American exports.

The new 25 percent duties on Mexico and Canada, and the doubling of the existing 10 percent levy on China, will affect about $1 trillion in imports. (Canadian energy products brought into the country will be taxed at 10 percent.)

Trump warned last week he would impose a 25 percent duty on goods from the European Union, which he said “was formed to screw the United States.”

Further stoking uncertainty: cuts to federal funding and mass firings of government workers ordered by Elon Musk’s Department of Government Efficiency.

Local impact: Massachusetts has been roiled by the National Institutes of Health’s decision to reduce medical research grants.

Across New England, NIH funding supports nearly 25,000 jobs that generate more than $4 billion in economic output, according to Bjorn Markeson, an economist at IMPLAN, an economic software and analysis firm.

He estimates the NIH’s new 15 percent cap on reimbursements for indirect costs — down from as high as 70 percent — puts 10,000 jobs and $1.4 billion in economic output at risk.

“The impact is not just on research scientists,” Markeson said. It will also affect their suppliers and other businesses where they spend money.

Caveats: The economic fears are real but the reality is more benign. Consider:

• The job market remains in good shape.
• Trump’s tariff bark could prove worse than his bite if he uses threats of higher duties as a negotiating tactic.
• Consumer confidence is prone to short-term swings.
• With a month left in the first quarter, the Atlanta Fed’s GDPNow tracker, which turned negative last week, could easily reverse course as more data are released and fed into the model.

Final thought: The economy is expected to grow at a respectable pace this year.

But the 2.3 percent median estimate of forecasters tracked by Bloomberg is down from the 2.8 percent increase recorded in the final year of the Biden administration. And inflation is expected to remain about where it is now.

“I think President Trump said that he’ll own the economy in six or 12 months, but I can tell you that we are working to get these prices down every day, but it took four years to get us here,” Treasury Secretary Scott Bessent told CBS News’ “Face the Nation” on Sunday.

True, the real test of Trump’s policies lies down the road. But the start has been less than auspicious.

Larry Edelman can be reached at [email protected].