How is the US economy really doing under President Trump?
The US economy has continued to grow under Donald Trump, despite concerns that his tariffs would slow activity, and is outperforming other G7 economies. But rising prices linked partly to tariffs and the US-Israel war with Iran are squeezing households, making the benefits of growth less clear for many voters.
GDP is expanding at an annualised 2.2% and has grown about 3.2% since the end of 2024. Inflation is 3.7%, up from 3% when Trump took office but below its 9% peak in 2022; diesel reached a record $6.52 a gallon in September. Real median household income rose 2.6% in 2025 to a record $87,460, while investment in data centres has surged, though the article notes the economy could weaken if the AI spending boom fades.
- The US economy is growing faster than other G7 economies.
- Inflation has risen since Trump took office, partly due to tariffs and energy costs.
- Record household incomes and AI investment support growth, but benefits are uneven.
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The US economy is the country’s overall system of jobs, businesses, trade and household spending. Growth means it is producing more goods and services; inflation means prices are rising, which can reduce what people can afford.
President Donald Trump’s policies include tariffs, which are taxes on some imported goods and can affect prices and trade. The Federal Reserve, America’s central bank, also influences the economy by setting interest rates to help manage inflation and support employment.
Economic figures can point in different directions: growth and rising incomes may benefit households, while higher prices can strain their budgets. The US is also part of the G7, a group of seven major advanced economies, so comparisons with other members help show how its performance fits into the wider picture.
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