WASHINGTON D.C. — Federal data released Thursday morning revealed that U.S. consumer prices rose 2.7% in the year through November, a figure that highlights a stark disconnect between official economic reality and the narrative of “rapidly falling” prices touted by President Donald Trump.
The Bureau of Labour Statistics (BLS) report, delayed by a 43-day government shutdown that ended in mid-November, showed that annual inflation ticked down from 3.0% in September. While the 2.7% reading was lower than many economists had predicted, it remains significantly above the Federal Reserve’s 2% target. More crucially for the administration, it directly contradicts the President’s assertion during a live prime-time address on Tuesday night that he had already “stopped” inflation and that prices were falling “very fast” on his watch.
“I am bringing those high prices down, and bringing them down very fast,” the President told a national audience, standing before a backdrop of festive White House decorations. “We inherited the worst inflation in the history of our country, and it is now a thing of the past.”
However, the 2.7% inflation rate is nearly identical to where it stood when the President was inaugurated in January 2025. Economists note that while the rate of price increases has fluctuated, the actual price level for essentials like food and energy remains significantly higher than it was four years ago—a persistent pain point for American households that shows no sign of a “rapid” reversal.
A Patchwork of Data and Disconnects
The November Consumer Price Index (CPI) report was one of the most anticipated in recent history, primarily because it was the first since the government shutdown rendered the BLS unable to collect data for the month of October. As a result, the “one-month” percentage change for November was not published, leaving analysts to piece together a two-month trend from September to November.
The data suggests a cooling of certain sectors, but also highlights stubborn pockets of high costs:
- Energy Costs: Despite Trump’s claims that gasoline is reaching $1.99 in multiple states, the national average remains closer to $2.94. While oil prices have dropped roughly 25% since January, the broader energy index is up 4.2% year-over-year, driven by a surge in fuel oil (+11.3%) and natural gas (+9.1%).
- Food at the Table: Food prices increased by 2.6% over the last 12 months. Certain staples, particularly protein and beverages, remain stubbornly high; the index for meats, poultry, fish, and eggs rose 4.7% over the last year.
- The Shelter Squeeze: The cost of housing, which accounts for a massive portion of the average consumer’s budget, rose 3.0% over the year.
The Tariff Shadow
The administration’s “maximalist” approach to trade remains the primary suspect for many economists when explaining why prices haven’t fallen as quickly as the White House promised. Since the implementation of a 10% universal baseline tariff and targeted levies as high as 50% on specific countries earlier this year, the cost of imported goods has faced upward pressure.
A recent analysis by the Federal Reserve Bank of St. Louis estimated that tariffs accounted for roughly 0.5 percentage points of annualized inflation over the summer. Similarly, the Yale Budget Lab found that 60% to 80% of new 2025 tariffs were passed directly through to consumer prices, particularly in “tariff-sensitive” categories like appliances, electronics, and furniture.
“The President is effectively pushing two opposing buttons,” said Marcus Thorne, a senior fellow at a D.C.-based economic think tank. “On one hand, he’s demanding the Federal Reserve slash interest rates to stimulate the economy. On the other, his trade policy acts as a massive tax on the supply chain, which keeps prices elevated. You can’t claim prices are falling rapidly when your own policies are essentially baking in a 3% floor for inflation.”
Blaming the Past, Facing the Future
Throughout 2025, President Trump has remained fixated on blaming former President Joe Biden for the “affordability crisis,” often referring to it as a “mess” he inherited. In his Wednesday address, he claimed his administration has brought “more positive change to Washington than any administration in American history.”
However, public sentiment appears to be shifting. While Trump enjoyed high approval ratings on the economy during his first term, recent YouGov/Economist polls show that his net approval on the issue of prices has fallen more sharply than any other topic, including immigration or national security.
The Federal Reserve, led by Chair Jerome Powell—whom Trump has repeatedly criticized and threatened to replace—has maintained a cautious stance. The Fed reduced interest rates three times this year but has resisted the administration’s calls for “massive” cuts. Last week, Powell reiterated the central bank’s commitment to its 2% target, describing the current situation as a “complicated and difficult” balance between a cooling labor market and elevated price levels.
The “Quiet Shutdown” Impact
The lack of October data created a “black hole” in the national economic record, one that the administration has used to its rhetorical advantage. Without a month-to-month comparison, the President has been able to frame the 2.7% November figure as a “crashing” of prices, even though it represents a very modest decline from September’s 3.0%.
“The data is essentially catching up to a reality consumers have felt for months,” noted Maria Gonzalez, an economist specializing in retail trends. “Prices aren’t falling; they are just rising slightly more slowly than they were two months ago. For a family seeing egg prices up 24% over the year or electricity up nearly 7%, the word ‘rapidly falling’ sounds like it’s coming from a different planet.”
As the holiday season reaches its peak, the administration is banking on a “military dividend”—promised $1,776 checks for service members—to boost consumer confidence. Whether that will be enough to offset the persistent “affordability gap” remains to be seen.