The media keeps attacking Trump but they need to give him time!
Inflation continued to rise in January 2025, putting pressure on the new administration to fulfill its campaign promise to lower prices “on day one” while navigating the economic implications of President Trump’s policies. The Bureau of Labor Statistics (BLS) reported a 0.5 percent month-over-month increase in the Consumer Price Index (CPI), a jump from the 0.4 percent rise in December and surpassing the expected 0.3 percent. The annual CPI rate edged up to 3.0 percent, exceeding the anticipated 2.9 percent.
Core inflation, which excludes volatile items like food and energy, also came in higher than expected. It increased by 0.4 percent in January, up from 0.2 percent in December, and outpaced forecasts of 0.3 percent. On a yearly basis, core inflation climbed to 3.3 percent, surpassing the previous month’s 3.2 percent and analyst expectations of 3.1 percent.
The rise in inflation highlights that the U.S. economy is still struggling with high prices. With the Biden administration’s economic policies in place, these new figures are likely to be used as evidence of the long-lasting effects of their approach. However, they also add pressure on the new leadership, which has made fighting inflation a central part of their agenda. This inflation report could also influence the Federal Reserve’s decisions on interest rates, especially as the central bank has kept rates steady after a series of cuts in late 2024.
The January inflation data marks the first full reading under President Trump’s return to office, offering insight into how his economic strategies—such as tax cuts, tariffs, and immigration reforms—might be affecting inflation in 2025. For instance, rent, which accounted for nearly 30 percent of the monthly increase, rose 0.4 percent. The energy index saw a 1.1 percent rise, with gasoline prices up 1.8 percent. Meanwhile, the food index climbed 0.4 percent, driven by a 0.5 percent increase in food at home costs and a 0.2 percent rise in food away from home.
The price of eggs, a critical measure for many families, skyrocketed by 15.2 percent between December and January—its largest monthly increase since June 2015. This jump alone accounted for about two-thirds of the increase in food at home costs.
Reducing the cost of goods in the U.S. has been one of President Trump’s primary campaign promises. He repeatedly stated that his administration would start cutting prices immediately. However, this inflation report suggests that the road to fulfilling that promise may be more difficult than anticipated. During an interview with CBS, Vice President JD Vance acknowledged that while he was confident in the new administration’s ability to bring down prices, it would take “a bit of time.”
“Under Biden, inflation is going up!” President Trump posted on Truth Social shortly after the inflation figures were released.
In a December interview with Time magazine, President Trump shared that while bringing prices down after they’ve risen is challenging, he believes it’s possible. “I think energy is going to bring them down. I think a better supply chain is going to bring them down,” he said.
Federal Reserve Chairman Jerome Powell, speaking before Congress, signaled that the Fed is in no rush to cut interest rates further. “We’re in a pretty good place with this economy. We want to make more progress on inflation, and we think our policy rate is in a good place,” Powell said, emphasizing that the Fed would adjust policy as inflation eases or if the labor market slows down.
Powell had previously said that the Federal Reserve was taking a “wait and see” approach, uncertain about how tariffs, immigration policies, and other regulatory changes under the new administration might affect inflation in the future. Later on Wednesday, Powell is expected to testify before Congress again, providing further insights into the Fed’s future plans in managing the economy.