Trump claims victory on US economy despite many Americans’ cost of living concerns | US economy
Donald Trump declared victory on the economy on Tuesday, 12 months after returning to office, declaring it the “greatest first year in history” as many Americans expressed concerns about the cost of living.
In a stream-of-consciousness speech at the Detroit Economic Club, the US president offered his golden view of how the economy is progressing under his watch. He claimed that prices had fallen and productivity had “shattered expectations” despite official data showing the contrary.
Even as Trump touted his accomplishments in the first year of his second term, he began acknowledging concerns about affordability across the U.S. as November’s midterm elections loom. The White House has moved in recent days to introduce a series of policy proposals aimed at addressing affordability.
“We’re going to go down as the greatest first year anyone has ever had in history, just based on the numbers,” Trump said, citing inflation and GDP data in Michigan that showed price growth stabilizing and the economy growing at a faster pace by the end of 2025.
Inflation has fallen slightly since the crash but remains significantly above typical levels. While GDP growth unexpectedly rose last summer, it came in the middle of a tumultuous year for the U.S. economy. Annual inflation fell to a four-year low of 2.3% in April, then rose to 3% in September. GDP contracted in the first quarter of 2025 for the first time since 2022.
The US labor market, which Trump did not mention in his speech, has had a particularly volatile year (the weakest since the pandemic), with the unemployment rate rising to a four-year high.
In August, Trump fired the federal government official in charge of employment statistics, hours after data showed that job growth had stalled.
But on Tuesday he praised official data, which he argued were incomparable. He said the numbers were “incredible.”
Wall Street continues to trade near record highs but Trump claimed the “really tough Fed” was holding the stock market back. “They kill every rally,” he said. “You have a good quarter and they want to end it because they are so afraid of inflation.”
Trump continues to wage an extraordinary campaign to control the Federal Reserve, where he has so far tried but failed to pressure it to lower interest rates. Recently, Jerome Powell came under criminal investigation for his testimony regarding renovations at the central bank headquarters.
In response, Powell called the investigation pretextual and noted that it followed the central bank’s decision to set “rates based on our best assessment of what will serve the public rather than following the president’s preferences.”
Trump claimed he was unaware of the investigation.
The widespread backlash his administration received for going after Powell did not stop the president from launching new attacks on the Fed chairman during his speech on Tuesday. Referring to Powell’s term ending in May, Trump said, “The mess will be over soon.”
Trump’s positive assessment of the economy is far from universally shared. Twice as many Americans believe their financial security is getting worse than better, according to a Harris poll conducted for the Guardian last month.
Trump passed responsibility for the economic difficulties to his predecessor, Joe Biden. “We inherited terrible growth and the worst inflation in our country’s history,” he said.
Inflation peaked at 9.1 percent in 2022, when Biden was in office, while inflation was hovering around 3 percent when the former president left office.
Trump’s extensive list of tariffs, which caused a massive stock selloff last spring, has caused significant economic turbulence in 2025. Although the market has rebounded quickly, many of Trump’s tariffs remain either paused or in legal limbo.
But according to Trump, the tariffs have been an economic success. “Trump’s tariffs have given us trillions of dollars of new investment and unprecedented new partnerships,” he claimed.
Although the Supreme Court is scheduled to rule soon on the legality of the 10% base tariff and so-called reciprocal tariffs, Trump has said he will not abandon his tariff strategy anytime soon, regardless of the decision. “If we don’t win, we will find something, but we have to win,” he said.
Trump also claimed that the recent US action in Venezuela paved the way for increased energy production and would ultimately cause donut prices to drop.
“When gas is $1.99 a gallon, everything goes down,” he said. “The donuts are coming down, the truck that brings the donuts, the stove that makes the donuts, everything is coming down. And it’s coming down faster than anyone could believe.”
While Trump has refused to acknowledge that any of his policies have increased the cost of living, he has outlined a series of policies designed to address affordability concerns, including plans to ban large institutional investors from buying single-family homes, buy $200 billion worth of mortgage bonds and force credit card companies to cap interest rates. Of the White House’s efforts to lower drug prices, he argued: “We should win the midterms on this issue alone.”
The president said he plans to talk more about upcoming housing policies at the World Economic Forum annual meeting in Davos next week.
