Inflation before Trumps second term and now
Executive summary
Inflation spiked sharply after 2020, driven to a peak in 2022 before moderating through 2023–2025, leaving prices roughly a quarter higher than at the start of the decade; that cumulative rise is still the lived reality for many households even as headline rates have cooled to low single digits [1] [2]. Recent official readings show year‑over‑year CPI measures in the neighborhood of roughly 2.6–3.1% in late 2025, with core measures nearer to 2.6–3.0%, though government data were disrupted by a 2025 lapse in BLS data collection that complicates month‑to‑month comparisons [3] [4] [5].
1. How inflation looked coming into a potential second Trump term: the 2020–2022 surge
The period immediately after 2020 saw a rapid acceleration in consumer prices: cumulative CPI growth since 2020 is reported at roughly 25% across the economy, and the year‑over‑year headline rate reached a peak near 9.1% in 2022 — levels that transformed household budgets and policy debates [1] [6]. That surge was broad‑based across categories — used cars, shelter, energy and food were notable drivers — and produced widely felt declines in purchasing power compared with pre‑pandemic prices [6] [7].
2. The glide path: 2023–2025 and the moderation of headline inflation
After the 2022 peak, headline inflation stepped down in 2023 and into 2024 and 2025: average annual inflation for 2023 was about 4.1%, and subsequent monthly and annual readings continued to trend toward the Federal Reserve’s long‑run goal [5] [1]. By late 2025, multiple trackers and the BLS releases showed year‑over‑year CPI readings in the mid‑to‑low single digits — for example, the Chained CPI‑U rose about 2.6% over the latest 12 months in a November 2025 BLS release — indicating cooler inflation but not a return to pre‑pandemic price levels [3] [5].
3. Where “now” stands numerically: late‑2025 / early‑2026 readings and caveats
Reporting in December 2025 and forecasts into early 2026 put headline CPI readings clustered around 2.7%–3.1% year‑over‑year, with some nowcasts and private sites showing a 3.1% November 2025 print or a 2.7% 12‑month pace depending on measure and timing; core inflation estimates were often near 2.6–3.0% [4] [5] [3]. Analysts and the Cleveland Fed emphasize nowcasting tools to bridge data gaps; importantly, the BLS did not collect October 2025 survey data because of a government shutdown, and the agency flagged that recent monthly indexes remain subject to revision — a fact that tempers definitive claims about short‑run reversals [4] [3] [8].
4. What those numbers mean in practical terms and for policy
A headline CPI in the high twos to low threes today means prices are still materially above 2020 levels — about 25% higher overall since 2020 by several calculators — so wage gains and interest‑rate decisions are judged against that higher price base rather than against the lows of early 2020 [2] [1]. The Federal Reserve’s long‑run target remains about 2%, so officials and markets view the current readings as closer to normal but not fully back to target; debates persist about whether underlying “core” pressures or pockets like shelter will keep rates elevated [9] [7].
5. Competing narratives and what the data can’t yet settle
Political shorthand — claiming inflation is either “crashed” or “out of control” — overstates what the data prove; the numbers show clear moderation from the 2022 peak but also persistent elevated prices relative to 2020, and methodological issues (data gaps, revisions) create room for differing interpretations by advocates, policymakers and partisan commentators [3] [4]. Independent nowcasting models and public CPI series provide tools to reconcile disparate readings, but reporting limitations around late‑2025 collections mean any definitive "before vs. now" verdict must acknowledge those caveats [8] [3].