Is the US Economy Doing Well Under Trump? Growth Data Examined
Growth is outpacing other G7 economies, but tariffs and the Iran conflict have pushed up inflation, and households feel the strain
By AXY Business Desk ·
Key points
- US GDP is growing at an annualised rate of 2.2%, according to the latest data cited by BBC Verify.
- Since the end of 2024, the US economy has grown by around 3.2%, more than any other G7 member over that period.
- Growth has outpaced the IMF's forecast downgrade made after Trump's April 2025 tariffs, although Trump later eased those tariffs.
- Evidence suggests tariffs and the US-Israel war with Iran have pushed up inflation, with effects felt by most households.
- An AI investment boom is supporting growth, and the economy could falter if that spending dried up.
President Donald Trump has been promoting the performance of the US economy ahead of the midterm congressional elections, claiming he has boosted incomes, reduced inflation and created jobs. He has repeatedly said: "We have the hottest country anywhere in the world." A BBC Verify review of the latest figures finds that the overall economy is growing at a respectable pace and faster than many analysts expected, but that the picture for ordinary households is more mixed.
The central piece of evidence is gross domestic product, or GDP. The latest data shows US GDP expanding at an annualised rate of 2.2%. Since the end of 2024, just before Trump began his second term, the economy has grown by around 3.2% overall. Over that same period, that is more growth than any other member of the G7 group of leading economies.
What the latest growth figures show
GDP is the total value of goods and services produced within a country over a given period, and it is the most widely used measure of the size and health of an economy. Economists use it to judge whether an economy is expanding, stalling or shrinking. The figure is usually reported as an annualised rate, which estimates what the growth would be over a full year if the current quarter's pace continued. A rate of 2.2% therefore means the economy is expanding at that pace on an annual basis, not that it grew by 2.2% over the year so far.
The cumulative figure of about 3.2% since late 2024 gives a longer view. It shows the economy has continued to expand across Trump's time in office so far, rather than only in a single quarter. The G7 comparison is also significant. The Group of Seven consists of the United States, Canada, France, Germany, Italy, Japan and the United Kingdom, along with the European Union as a participant. Growth ahead of this group does not guarantee strong living standards at home, but it does suggest the US has been expanding faster than its closest economic peers over this period.
Why GDP growth matters to ordinary Americans
GDP growth is an aggregate measure, which means it can look healthy even when many people are struggling. Strong output can come from big companies, wealthy investors or a few booming sectors, while wages, prices and jobs can feel very different for a family working through a tight budget. That gap between national statistics and household experience is at the heart of the political debate about the economy before the midterms.
The midterms are congressional elections held halfway through a presidential term. Every seat in the House of Representatives and about a third of the seats in the Senate are contested. Because voters often judge the economy through prices, paychecks and job security, presidents tend to emphasise economic figures in the run-up to these contests, and their opponents tend to focus on the costs that voters notice most.
Tariffs, the IMF and a shifting trade policy
Trump's approach to trade has been central to the economic story. On 2 April 2025 he announced a sweeping set of new tariffs, which are taxes on goods imported into the US. He called them "Liberation Day" tariffs. Tariffs are typically paid by importing companies, and businesses often pass some or all of those costs on to consumers through higher prices, though the exact split depends on competition, supply chains and how companies choose to absorb costs.
The International Monetary Fund (IMF), the Washington-based lender that monitors the global economy and publishes growth forecasts, downgraded its outlook for the US in the immediate aftermath of the announcement. It cited the negative impact of the import duties on business investment and consumer spending. The US economy has since grown faster than the IMF's downgraded forecast, which is one reason the BBC Verify review describes the overall performance as better than many expected.
The review also notes that Trump eased the tariffs considerably in the months that followed. That reduced the damage that had initially been expected. It means the economic effects of trade policy are not fixed, and that the net impact depends on which tariffs remain in force and for how long.
Inflation and the cost of living
Inflation is the rate at which prices for goods and services rise over time. When inflation is high, the same paycheck buys less, which is why it is one of the most politically sensitive economic measures. Trump has claimed that he has reduced inflation. The evidence reviewed by BBC Verify suggests a more complicated picture. It indicates that the import taxes, along with the effects of the US-Israel war with Iran, have pushed up inflation, and that the harmful effects of this have been felt by most American households.
The distinction matters. A government can point to slower growth in inflation over a period, but the level of prices remains high for families who have already absorbed past increases. Households tend to judge the economy by what they pay for everyday essentials such as food, fuel, housing and childcare, rather than by changes in an index over a few months. This is why a strong GDP figure and a sense of financial pressure can coexist.
Jobs and incomes: the claims still to test
Trump has also claimed that his policies have boosted incomes and created jobs. Judging these claims requires separate measures. Employment is usually tracked through monthly labour market reports, which show how many people are in work and the unemployment rate. Real incomes, meaning earnings adjusted for inflation, show whether wages are actually buying more than before. A rise in nominal pay can still leave people worse off if prices have risen faster.
The BBC Verify report sets out to examine inflation, jobs and economic growth together, and its findings on growth are the clearest part of the evidence available in the source material. Readers who want to test the jobs and income claims directly should look at the official employment and wage figures from the US Bureau of Labor Statistics, which publishes them regularly, and compare the most recent data with the period before January 2025.
The AI investment boom and the risks ahead
The US economy is also being helped by an investment boom linked to artificial intelligence. Spending on AI, including data centres, chips and related infrastructure, adds directly to GDP and can support jobs in construction and technology. The source material warns that this support could falter if that spending were to dry up. Economists often describe this kind of dependence as a concentration risk: when a large share of growth depends on one type of spending, a sharp slowdown in that area can weigh heavily on the wider economy.
Analysts commonly treat such booms with caution, because investment can outpace the returns that companies earn from it. If investors reduce spending, or if companies scale back plans, growth could slow more quickly than the headline figures suggest. This is a possibility rather than a forecast, but it is one reason the current growth figures are seen as sensitive to a small number of drivers.
What to watch before the midterms
Several indicators will shape how the economy is judged in the coming months. The first is the next GDP release, which will show whether the 2.2% annualised pace holds. The second is inflation data, particularly whether price rises continue to be driven by tariffs and energy costs linked to the conflict with Iran. The third is employment data, which will show whether job creation is keeping pace with the population and whether real wages are rising.
Trade policy is another key factor. Any changes to tariffs, whether further reductions or new increases, could alter both prices and business investment. The durability of the AI investment boom will also matter, since much of the recent growth depends on it. Voters will be weighing all of these signals against their own experience of prices and pay, and the gap between the national picture and household finances is likely to remain central to the debate.
For readers, the key point is that the economy is growing faster than many expected and faster than other large economies over the period since Trump took office, but that growth has come alongside inflation pressures that many households still feel. Whether the headline figures and everyday experience move closer together will be one of the most closely watched questions as the midterms approach.
Questions and answers
Is the US economy growing faster than other G7 countries?
According to the BBC Verify review, US GDP has grown by around 3.2% since the end of 2024, which is more than any other G7 member over that period. The latest annualised growth rate is 2.2%.
Has inflation fallen under Trump?
The evidence reviewed by BBC Verify suggests that tariffs and the US-Israel war with Iran have pushed up inflation, with harmful effects felt by most American households. Trump has claimed he has reduced inflation, but the review indicates a more complicated picture.
Why did the IMF downgrade its US growth forecast?
The IMF downgraded its forecast in the immediate wake of Trump's tariff announcement on 2 April 2025, citing the negative impact of import duties on investment and consumer spending. Trump later eased the tariffs considerably, reducing the expected impact.
What could slow the US economy next?
The source material warns that the economy is being helped by an AI investment boom and could falter if that spending dried up. Tariff changes and inflation pressures are also key factors to watch before the midterm elections.
Topics: Donald Trump, US economy, GDP growth, Inflation, Tariffs, 2026 midterm elections, G7, AI investment
Sources: BBC Business
https://axynewsglobal.com/article/is-the-us-economy-doing-well-under-trump-growth-data-examined