US Core Inflation Drops to Five-Year Low

Key Takeaways

• Inflation is down by approximately 70% from its peak during the Biden era
• Core inflation is at its lowest level in nearly five years, with a rate that would be 1.2% if the current pace continues
• Prices for essential items such as groceries, medicine, and gas are decreasing
• Wages are increasing, with private sector workers expected to see a $1,300 rise in real wages in President Trump’s first full year in office
• The Trump administration’s economic policies have been successful in reducing inflation and increasing wages, despite initial skepticism from economists

Introduction to the Current Economic Situation
The latest inflation data has exceeded economists’ expectations, with core inflation reaching its lowest level in nearly five years. According to the White House Press Secretary, Karoline Leavitt, this trend is expected to continue into the New Year, with Americans experiencing lower prices and bigger paychecks. The current data shows that inflation is down, gas prices are down, the deficit is down, and wages are up, indicating a positive economic outlook. President Trump has stated that the best is yet to come, and the latest data suggests that the era of inflation is over.

Analysis of the Latest Inflation Data
The latest inflation data reveals that the rate of inflation has decreased by approximately 70% from its peak during the Biden era. If the current pace continues, inflation would be running at only 1.2%, which is far below the Fed’s 2% target. This decrease in inflation is accompanied by a decline in prices for essential items such as groceries, dairy products, fruits and vegetables, toys, prescription drugs, clothing, airfares, natural gas, car and truck rentals, and hotels. Moreover, rent inflation is at its lowest since October 2021, which is a significant improvement. The data also shows that wages are increasing, with private sector workers expected to see a $1,300 rise in real wages in President Trump’s first full year in office.

Expert Opinions on the Current Economic Situation
Economists and experts have been surprised by the latest inflation data, with many expressing positive sentiments about the current economic situation. CNBC’s Steve Liesman described the data as "a very good number," while CNN’s Matt Egan stated that it is "another step in the right direction." Harvard University Professor of Economics and Public Policy, Ken Rogoff, described the data as "a better number than anyone was expecting" and "positive news." Economist Steve Moore expressed his excitement about the data, stating that it is "amazing" and "good news for Wall Street and Main Street." Strategic Wealth Partners CEO, Mark Tepper, also praised the data, stating that it is "incredible" and that the affordability gap is closing under President Trump’s watch.

The Trump Administration’s Economic Policies
The Trump administration’s economic policies have been successful in reducing inflation and increasing wages, despite initial skepticism from economists. The administration’s policies, including tariffs, have been criticized by some as being inflationary, but the latest data suggests that they have had the opposite effect. The Washington Examiner’s Tiana Lowe Doescher praised President Trump’s economic policies, stating that they have brought inflation down and are "well done." Bloomberg’s Chris Anstey also noted that the latest data is "remarkable" and exceeds the expectations of economists. The Washington Post’s Andrew Ackerman stated that the inflation data is a "welcome reprieve" for the White House and households.

Conclusion and Future Outlook
In conclusion, the latest inflation data suggests that the era of inflation is over, and the Trump administration’s economic policies have been successful in reducing inflation and increasing wages. The data shows that prices for essential items are decreasing, and wages are increasing, indicating a positive economic outlook. President Trump has stated that the best is yet to come, and the latest data suggests that this may be the case. As the economy continues to grow and inflation remains low, Americans can expect to experience lower prices and bigger paychecks, making it a banner year ahead.