During his State of the Union address on Tuesday, President Donald Trump boasted about the progress his administration has made on inflation. Here are the price declines and the key context.
“The Biden administration and its allies in Congress gave us the worst inflation in the history of our country,” Trump said. “But in 12 months, my administration has driven core inflation down to the lowest level in more than five years, and in the last three months of 2025, it was down to 1.7%.”
TRUMP’S ECONOMIC TALKING POINTS FOR THE STATE OF THE UNION
Inflation has fallen since Trump entered office in January of last year. The decline came after years of historically high inflation under former President Joe Biden, a phenomenon that helped Trump win the 2024 presidential election. But inflation is still too high, and affordability issues continue to plague voters.
When Trump was sworn in for his second term, inflation, as measured by the consumer price index, was about 3%. That is a full percentage point above the Fed’s long-range goal of 2%, which it considers healthy.
CPI inflation has now fallen to 2.4% over the past year. Core inflation, a measure that strips out volatile food and energy prices, has fallen to 2.5% for the year ending in January, the lowest core inflation since March 2021.
While that is still above the Fed’s healthy range, it is trending downward.
Still, other measures of inflation haven’t been trending in the right direction.
The Fed’s preferred inflation gauge, the personal consumption expenditures index, has now increased for two months in a row and was running at 2.9% in December, the most recent available data.
Gas prices have fallen under Trump, something that he mentioned during his Tuesday speech. They are down 7.5% from last year, which is especially helpful for people who commute to and from work.
“Gasoline, which reached a peak of over $6 a gallon in some states under my predecessor, it was, quite honestly, a disaster. Is now below $2.30 a gallon in most states, and in some places, $1.99 a gallon,” Trump said on Tuesday.
But at the same time, electricity prices have risen 6.3% over the past year.
Consumers often feel the pinch of inflation most acutely at the grocery store. While the prices of many food items have moderated, or even fallen, others have risen even faster under Trump.
In the past year, the price of fresh whole chicken has fallen 1.3%. Egg prices, which were high last January thanks to an outbreak of the avian flu, are down more than 30%. And cheese prices have fallen 1.2% since this time last year. Some fruit and vegetable prices, such as those for potatoes and tomatoes, have also posted declines.
Still, ground beef prices increased by more than 17%. Uncooked beef roasts are up 15% and steaks cost nearly 13% more. Coffee prices have also risen 18.3% over the past year.
Taken together, grocery prices are up 2.1% over the past 12 months or so. Food inflation at restaurants has nearly doubled, with dining out costing 4% more than last year on average.
ECONOMY GREW AT 2.2% IN 2025, BEATING PREDICTIONS
Despite overall inflation being lower than when Trump took office, consumers are still complaining about the cost of living and are starting to blame Trump. His economic approval ratings have taken a major hit over the past year or so, which spells trouble for Republicans in the midterm elections.
An AP-NORC poll this month found that 59% disapprove of Trump’s handling of the economy and 39% approve.