In his first address to Congress since re-taking office, President Donald Trump made a lot of claims, including one about the economy that doesn't add up.
"As you know, we inherited from the last administration an economic catastrophe and an inflation nightmare," President Trump said.
The Consumer Price Index, a measurement of price increases, spiked at 9.1% in 2022 but had dropped to 3% by the end of the Biden administration. That's a percentage considered healthy and sustainable. Unemployment was near historic lows and wages were growing.
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New data out over the past few days indicates the economy is now slowing down and inflation is ticking up as President Trump places tariffs on Canada, Mexico and China. Instead of economic growth, the Atlanta Fed predicts shrinkage of the nation's gross domestic product by over 2%. That is a sharp reversal from a few weeks ago when the Federal Reserve showed the economy growing.
The Consumer Price Index updated on March 12 will reflect what happened in February with President Trump in office, and will show where inflation stands.
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Truth be told, Trump did not inherit an "economic catastrophe" or an "inflation nightmare." One nightmare he did inherit was the rising price of eggs, which has continued to go up during the early days of his presidency.
Despite the new warning signs, the economy remains relatively strong, especially the jobs rate. President Trump is betting that any short-term pain from tariffs will pay off in a resurgence of companies moving manufacturing back to the U.S.
