Trump Gives “A+” Grade to Economy Despite Rising Concerns Over Inflation and Deficit Data
In a recent appearance, President Donald Trump enthusiastically rated the economy an “A+! A+++++!” This proclamation caught significant attention online. A tweet applauding the moment labeled it as “EPIC,” leading to a mix of approval and skepticism among analysts and economists.
While Trump’s fervor was evident, a look at economic data for the third quarter of 2025 presents a more nuanced scenario. The figures reveal a landscape of strong output and job growth, yet ongoing inflation concerns, growing apprehension among consumers, and a staggering federal deficit surpassing $1.7 trillion are also highlighted.
Economic Growth: Solid but Not Spectacular
According to the Wall Street Journal’s survey conducted on October 12, 2025, the U.S. economy registered a 2.7% annualized growth rate in Q3. This growth was largely propelled by steady consumer spending and consistent business investment, particularly in sectors utilizing advanced technologies, such as artificial intelligence.
Household spending remained strong during the summer months, as consumers continued to drive demand despite rising prices. The labor market maintained stability, averaging an unemployment rate around 4.3%, in line with economists’ expectations. The report noted, “With modest hiring but low layoff rates, firms appear to be planning for output growth via productivity improvements,” suggesting that businesses are focused on enhancing efficiency without significantly increasing their workforce.
Inflation Pressures Still a Pain Point
The annual inflation rate measured by the Consumer Price Index (CPI) stood at around 3% in September 2025, still above the Federal Reserve’s target of 2%. While this represents a decrease from previously higher rates, essential goods remain costly, adding pressure on household budgets.
Fuel prices have been particularly volatile, with a CPI increase of 3.7% for gasoline from June to September, translating to an annual rate of 15.9%. Rising energy costs accounted for over 10% of the overall CPI inflation during the quarter. Food prices also continued to rise, notably affecting categories like protein and produce.
Despite some sectors showing signs of stability, public sentiment remains cautious. Polling data indicates that many citizens, particularly older adults and those on fixed incomes, express concern regarding their purchasing power and the economic outlook for 2026.
Deficit Claims Don’t Match the Record
In a separate social media post from the White House’s account, President Trump claimed that his administration had reduced the federal deficit by more than 25% through various policies, including tariff revenues and spending cuts. However, this assertion was quickly challenged by a Community Note referencing U.S. Treasury data.
Official reports show the fiscal year 2025 deficit at $1.78 trillion, reflecting a mere 2% decline from $1.83 trillion in FY 2024. This figure starkly contrasts with Trump’s purported 25% reduction and highlights the risks associated with exaggerating economic success. In a political climate where fact-checking is instantaneous, such inaccuracies can have serious implications.
Although the administration has introduced measures designed to reduce spending—such as freezing select federal discretionary programs and intensifying tariff enforcement—the impact on the deficit remains minimal. Ongoing expenditures from entitlement programs and interest payments on the national debt continue to significantly contribute to fiscal challenges.
Shutdown Weighs on Short-term Outlook
Another factor exacerbating economic uncertainty is the ongoing government shutdown, which reached its fifth week as of October 31. The funding lapse has resulted in the furlough of thousands of federal employees, hindered administrative functions, and delayed the release of vital economic data.
Federal workers affected by the shutdown have begun enrolling in the Deferred Resignation program, allowing them to leave without penalties after extended furloughs. Analysts warn that if the impasse persists, it could diminish GDP growth and further undermine consumer confidence. One economist noted, “The drag on real GDP from the federal shutdown is likely to be moderate in the short run but could become significant if extended into the holiday quarter.”
Jobs Remain Strong—But with Caveats
On paper, the labor market exhibits resilience, marked by historically low private-sector layoffs—just 1.3% of employment according to the Bureau of Labor Statistics. Job openings remain substantial, although they have decreased slightly from their peak, aligning with a gradual slowdown in hiring intentions.
However, some of this stability results from structural changes. Deportation initiatives supported by the Trump administration have limited the labor supply in several states. Consequently, many businesses are prioritizing capital investment over workforce expansion, steering the economy toward productivity-oriented growth instead of labor-intensive practices.
Tariffs: Revenue vs. Inflationary Risks
Trump continues to advocate for tariffs as both a source of federal revenue and a means to stimulate domestic production. He argues that his trade policies, specifically the high tariffs on Chinese imports, are aiding in deficit reduction and protecting American jobs.
Yet, economists are divided on this issue. While tariffs provide revenue for the Treasury, they also inflate prices for imported goods that consumers and manufacturers must absorb. Trump’s proposed tariffs, including a broad-based 10% charge and a staggering 60% on Chinese imports, could further escalate input costs, exacerbate inflation, and provoke international backlash.
Polling: Economic Optimism Mixed
While Trump’s supporter base shows robust backing for his economic management—81% of Republicans approve in recent surveys—caution permeates the broader electorate. A Reuters/Ipsos poll indicates that Trump’s economic approval dropped to 37%, a decline from 42% earlier in the year. Notably, 54% of voters attribute current economic instability to the administration’s policies.
Among independent voters, 56% label Trump’s economic approach as “too erratic.” Alarmingly, even within his party, one-quarter express unease about the reliability of his strategies. Stock markets have also reflected this uncertainty, with the S&P 500 down about 14% from its peak in February 2025.
Conclusion: A Grade, but Far From Perfect
Trump’s spirited “A+” assessment of the economy, while memorable, does not fully resonate with the data at hand. While certain sectors display encouraging trends—particularly those linked to AI investments and sustained job growth—other aspects signal troubling signs. Ongoing inflation, stagnant wage increases, and a persistently high deficit complicate the economic outlook. Coupled with a protracted government shutdown and looming tariffs, the risks in the near term are substantial.
As one senior economist aptly remarked, “We’re not in a recession, but this isn’t a perfect economy either. If you give it an A+, it’s fair to ask—what would failure look like?”
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