Trump Touts Low Inflation as Economy Is ‘Doing Well,’ but Latest Price Index Disagrees 

President Donald Trump declared victory over inflation this week, telling the Detroit Economic Club that grocery prices are “starting to go rapidly down” and insisting the economy is doing well. Government statistics tell a starkly different story. December data from the U.S. Bureau of Labor Statistics showed food costs accelerating at their fastest monthly clip since 2022. Coffee prices have surged nearly 20% year over year, while ground beef jumped 15.5%. The widening gap between Trump’s confident assertions and actual price trends has become a flashpoint as both parties gear up for November’s midterm elections.

Trump celebrated the 2.7% inflation rate in a social media post, writing, “JUST OUT: Great (LOW!) Inflation numbers for the USA.” Yet that figure remains stubbornly above the Federal Reserve’s 2% target and only marginally below the 3% rate when he took office in January 2025. Grocery prices specifically rose 2.4% year over year in December, according to BLS data. While Trump claimed at the White House that “we have very low inflation,” economists point to supply chain disruptions, weather events, and his own tariff policies as driving persistent price increases that consumers feel daily.

The gap between Trump’s victory lap and household reality is stark. Nearly 70% of American families report struggling to afford groceries and living paycheck to paycheck, according to a DNC statement. “We’re all feeling it,” said Naomi Blohm, a senior market adviser for Total Farm Marketing. DNC Rapid Response Director Kendall Witmer argued Trump is “already failing to deliver on his promise of an affordable 2026,” while Republican National Committee Chair Joe Gruters countered that “there’s nobody who’s been more focused on affordability than President Trump.” Both parties recognize that the cost of living will decide November’s midterm battles.

Supply Shortages Drive Beef Prices Sharply Higher

The surge in beef costs traces directly to devastating drought conditions that struck major cattle-producing regions in 2022, according to David Ortega, a food economist at Michigan State University. Ranchers faced a brutal choice when drought drove up the price of cattle feed, forcing many to sell off more animals than usual just to stay afloat. The decision to liquidate herds provided short-term relief but decimated future supply, as ranchers sold breeding stock essential for replenishing cattle populations. Years later, those choices continue reverberating through grocery aisles.

Cattle numbers remain substantially below historical levels, even as consumer appetite for beef stays strong. Naomi Blohm, a senior market adviser for Total Farm Marketing, noted that demand “continues to be strong” despite higher prices. This mismatch between constrained supply and persistent demand has created a perfect storm for price increases. Ground beef costs jumped 15.5% in December compared to the previous year, while beef steak prices climbed 17.8% over the same period, according to government data.

The problem extends beyond steak and hamburger. Nearly every beef product on grocery shelves reflects these supply constraints, with prices unlikely to moderate until ranchers can rebuild their herds. Experts say that restoring cattle populations takes years, not months, meaning consumers should expect elevated beef prices well into 2027. The timeline for recovery depends on favorable weather conditions, stable feed costs, and ranchers’ willingness to invest in rebuilding rather than maintaining reduced herd sizes.

Tariffs and Weather Push Coffee and Cocoa Costs Higher

Coffee prices soared nearly 20% in December compared to the previous year, driven by a combination of adverse weather conditions in key growing regions and trade policy impacts. Cocoa beans face similar pressures, contributing to rising costs for chocolate and candy products. These commodities share vulnerability to climate disruptions in tropical growing zones, where unpredictable rainfall patterns and temperature swings directly affect harvest yields. When supply tightens in Brazil, Colombia, or West Africa, American consumers feel the impact within months.

Trump’s 50% tariffs on steel and aluminum have compounded these pressures by driving up packaging costs across the food industry. Steel prices jumped 16% over the past year, according to wholesale price data. Jason Miller, a professor of supply chain management at Michigan State University, explained that manufacturers now pay substantially more for cans and other metal containers. Those increased costs inevitably flow through to consumers as companies adjust retail prices to maintain margins, affecting everything from canned vegetables to coffee.

The administration announced framework trade agreements with Latin American countries in November, aiming to lower tariffs on heavily imported goods like bananas. While this policy shift could eventually moderate some food prices, Ortega cautioned that such changes typically take several months to filter through supply chains. Banana prices have already climbed nearly 6% over the past year, and consumers shouldn’t expect immediate relief even if tariff reductions take effect. Miller added that “prices are going up” as manufacturers absorb higher input costs throughout the production chain.

Political Battle Over Affordability Intensifies Before Midterms

Trump framed December’s 2.7% inflation rate as vindication, celebrating what he called “Great (LOW!) Inflation numbers” in a social media post. Speaking at the White House, he insisted, “The inflation numbers just came out, and we have very low inflation,” before heading to Michigan to tout economic progress. RNC Chair Gruters emphasized Trump’s push to eliminate taxes on tips, Social Security, and overtime, arguing these policies directly address affordability concerns. He pointed to declining gas prices and stabilizing egg costs as evidence Republicans “win hands down” on pocketbook issues, despite grocery prices rising faster than they have in years.

Democrats counter that working families continue facing severe economic pressure despite Republican claims of success. DNC Chair Ken Martin bluntly stated at the party’s winter meeting that things are “too expensive,” framing affordability as Democrats’ central campaign message. Witmer argued that Trump spent his first year focused on “chaotic foreign policy” while families struggled with rising costs and a weakening job market. The party points to decisive victories in the November 2025 elections as proof that voters respond to their affordability-focused messaging.

While some prices show relief, the overall picture remains challenging for American households. Egg costs dropped 20.9% in December compared to the previous year, and tomato and potato prices also declined. Yet these bright spots can’t offset broader food inflation that persists above the Federal Reserve’s target. Experts warn that supply constraints will likely keep many grocery prices elevated for another couple of years. Until ranchers rebuild cattle herds, weather patterns stabilize in key growing regions, and tariff pressures ease, shoppers should expect continued strain on household budgets when they reach the checkout line.