In brief
Trump touts a booming economy, but data suggests a more nuanced picture. GDP is rising faster than forecasters predicted, yet inflation has crept up due in part to fresh tariffs and the Middle East conflict. Household incomes are still growing, though the middle classes are feeling the pinch. Job creation remains sluggish compared with the previous administration, while borrowing costs—and mortgage rates—hit multi‑decade highs. The narrative shows the trade‑off between growth, price stability, and rising debt that shapes the American economic reality.
Is the US Really On A Growth Spur Under Trump?
President Donald Trump claims the economy is booming, citing higher incomes, lower inflation and a surge in jobs. BBC Verify has reviewed the evidence to see how close those claims are to reality.
1. GDP Is Growing Stronger Than Forecast
The latest U.S. Gross Domestic Product data shows an annualised acceleration of 2.2 %, the fastest in 14 years. Over the last 12 months, growth is about 3.2 %, outpacing every other G7 economy. The International Monetary Fund (IMF) raised its outlook after Trump announced a broad tariff set on 2 April 2025, expecting the measures to dampen investment and consumption. The administration quickly eased most duties, mitigating the initial impact.
2. Inflation Has Re‑accelerated
The Consumer Price Index now sits at 3.7 %, higher than the 3 % level Trump inherited. Economists estimate tariffs have added roughly 0.4 pp to the rate, and the Iran war has lifted energy prices further. A record high for gasoline prices hit $6.52 a gallon in September, and staples like beef and coffee have risen noticeably.
3. Household Income Grows, But Middle and Poorer Classes Lag
Median disposable income climbed 2.6 % in 2025, reaching $87,460—the highest on record. However, the Institute on Taxation and Economic Policy (ITEP) projects that the middle fifth of households will be $1,700 poorer in 2026, while the poorest fifth will see a $750 decline. The richest 1 % enjoy a $12,560 gain, largely from tax cuts.
4. Job Creation Has Slowed
On the back of tariffs, President Trump promised a “flood of jobs.” Since January 2025, the economy has added an average of 34,000 jobs per month—well below the 122,000 monthly pace in Biden’s final year. Manufacturing employment stands at 12.6 million, slightly below the 12.8 million observed at the start of Trump’s term. The unemployment rate remains low at 4.2 %, partly thanks to a tighter immigration policy that reduced the labor supply.
5. Rising Borrowing Costs Hit Households
The federal deficit reached $2 trillion in the year to September 2026—about 6 % of GDP. The growing debt raises borrowing costs, pushing the 10‑year Treasury yield above 5 %, the highest since 2007. Mortgage rates have risen to 7.4 % from 6.9 % at the start of Trump’s term, eroding home affordability. Many homeowners refrain from moving due to the temptation of lower‑fixed rates on existing mortgages.
Data graphics by Erwan Rivault.
Further Reading
Explore the full GDP data here.
US Household Income Statistics.
Mortgage rates update.
