What President Trump said about the U.S. Economy in the SOTU Address

SOUTH BEND, Ind. -- Several topics were discussed in President Trump’s State of the Union address, from foreign wars to immigration to the economy. The President said gas prices are lower, and the stock market is booming.

President Trump said, “The roaring economy is roaring like never before,” and that gas prices are lower and the stock market is booming.

A recent ABC News/Washington Post/Ipsos poll shows 41 percent of Americans approve of Trump’s handling of the economy, while 57 percent disapprove.

He also addressed electricity prices, as data from the Bureau of Labor Statistics shows Americans are paying more for energy, in some cases, due to AI data centers.

“Tonight, I'm pleased to announce that I have negotiated the new ratepayer protection pledge. You know what that is? We're telling the major tech companies that they have the obligation to provide for their own power needs. They can build their own power plants as part of their factory so that no one's prices will go up, and in many cases, prices of electricity will go down for the community and very substantially down,” said Trump.

Recent data shows inflation dropped to 2.4% in January compared to the year prior and is down from 2.7 percent in December.

The president said his administration has driven core inflation down to the lowest level in more than five years.

Andreas Hauskrecht, Ph.D., is a Clinical Professor of Business at the IU Kelley School of Business.

“Core inflation is not the lowest in five years. This is simply an incorrect statement. The Federal Reserve is not using the CPI, the Consumer Price Index, as a measure. It uses the Personal Consumption Expenditure Index. With a three percent core, you are roughly .7 percent higher than the 10-year average. This is higher, .7 higher, than the 10-year average,” said Hauskrecht.

Trump said the cost of various items is lower compared to when he took office, like chicken, butter, or fruit.

As of January, food prices were up roughly 25 percent since the pandemic, according to the Associated Press, with affordability a big concern among American households.

Tariffs have impacted foods like produce, beef, and coffee.

Hauskrecht says the PCE, the inflation index the Fed looks at, shows inflation ticking up.

“Since 2025, inflation expectation is rising. It's not decreasing. And so, we are more and more, I hate the word, but we are more and more moving in a situation —what we call ‘stagflation’, where we have lackluster economic growth and an inflation level that we are uncomfortable with,” said Hauskrecht.

He cites tariffs as the reason a lot of uncertainty has been infused into economic decisions and that they have impacted economic activity globally and nationally.

“We have an interesting paper that came out three weeks ago from the Federal Reserve in New York, where we call this [the] 'pass-through' effect. This is how higher import prices are translated into the US economy, and we know now that probably from the tariffs, 90% of the cost are now on the shoulders of American companies and American consumers,” said Hauskrecht.

He says higher tariffs are producing higher inflation.

Hauskrecht also mentioned the large budget deficit and government debt as a burden for the younger generation.