Economic Insights on Trump’s Policies
On Thursday, economist Steve Moore discussed the effects of President Donald Trump’s policies on the U.S. economy, particularly focusing on inflation and wages.
Moore pointed out that Trump celebrated an economic milestone when the Personal Consumption Expenditures (PCE) index reported in April 2025 that inflation had dropped to its lowest level in four years. Speaking on “Kudlow,” he asserted that Trump’s initiatives were mainly deflationary, which resulted in beneficial outcomes for many Americans.
“Everything that Trump has done regarding tariffs is deflationary. I think there are isolated cases where tariffs might lead to cost increases. So, we might see some of those tariff costs passed on to consumers,” Moore remarked.
He emphasized that this current situation is a marked improvement compared to the inflation rates of 6%, 7%, and 8% experienced during former President Joe Biden’s administration.
Moore expressed his surprise at the media’s reaction to the 2.7% inflation rate, saying, “It’s fascinating that people went into a frenzy over 2.7% inflation, acting as if it were catastrophic, especially when we had inflation rates around 6% to 9% under Biden.”
He also pointed out that the growing economy has positively influenced the federal deficit, leading to increasing revenues.
“Back to the inflation matter—I want to mention something quickly. Yes, 2.7% is a bit high. I hope to see that number closer to 2.5%. What really concerns Americans is whether their wages are outpacing inflation, and right now, they are better off economically,” he added.
The Consumer Price Index (CPI) recorded a 2.7% rise year-on-year in June, aligning with expectations set by the Labor Statistics Bureau. However, the producer price index (PPI) emerged below forecasts when excluding food, energy, and trade factors.
According to Dow Jones economists, a 0.2% increase in wholesale prices was anticipated for June. The steady wholesale price, alongside CPI data, suggests that Trump’s tariffs have had minimal effects on the economy and the costs of goods and services. Notably, inflation hit a four-year low in May, despite media warnings that tariffs might provoke significant price hikes.
