New data suggests a notable deceleration in the U.S. inflation rate, potentially offering some relief to both consumers and policymakers.
According to Truflation, a blockchain-based provider of real-time economic data, inflation has slowed to around 1.3 percent, having dropped to below the 1.5 percent mark at the start of March. By Truflation’s readings, these are the lowest levels inflation has reached since December 2020. It peaked at over 11.5 percent in June 2022.
Why It Matters
Trump’s campaign placed a heavy emphasis on the state of the U.S. economy and in particular inflation, painting his predecessor’s policies as an accelerant and vowing to bring prices for American consumers down “on Day One.”
Prior to his November victory, Trump had been a persistent and outspoken critic of “Bidenomics,” holding the then-president responsible for the nation’s inflationary struggles, which he called “a country killer.” As a result, inflation has become arguably the most important touchstone for the current administration, and will be a closely watched metric to measure his economic agenda.
While inflation will need to slow further—reaching negative figures—for the price of goods and services to decline, significantly slowing inflation signals price stabilization, serving as a slight relief for concerned consumers and the Federal Reserve, which has been tasked with achieving a 2-percent inflation target.
What To Know
As outlined on its methodology page, Truflation’s real-time inflation metric relies on market price data from more than 30 commercial and public sources, capturing 13 million price points for goods and services at any moment. This separates it from the commonly consulted consumer price index (CPI), released monthly by the Bureau of Labor Statistics (BLS), which relies on periodic surveys, though this allows time to both collect and verify data, while also enabling analysis of inflationary trends rather than daily price changes.
According to the most recent BLS reading, released Wednesday morning, February saw less steep price increases for consumers. The Consumer Price Index (CPI) rose by 0.2 percent, a slowdown from January’s monthly 0.5 percent gain. Annual inflation also showed signs of improvement, easing to 2.8 percent from 3.0 the previous month.
The core inflation rate—excluding volatile prices such as those for food and energy—slowed to 3.1 from 3.3 percent annually, the lowest rate since April 2021. On a monthly basis, core inflation fell to 0.2 from 0.4 percent.
All measures came in better than had been anticipated in analyst forecasts compiled by TradingEconomics.
Getty/Newsweek
Despite the encouraging signals from both Truflation and the BLS, concerns are mounting that President Trump’s dynamic tariff plans could result in even higher prices, as import costs rise and these charges are passed on to the American consumer.
Slowing inflation, while potentially easing the burden on consumers, has also been cited as evidence of weakening demand and slowing economic activity.
What People Are Saying
Truflation, on X, formerly Twitter: “Our data shows that inflation is falling. However, the effect of tariffs remains uncertain.” Attached was a poll in which 66 percent said inflation “will be controlled by 2025.”
Our data shows that inflation is falling 🇺🇸
However, the effect of tariffs remains uncertain.
Do you believe that US inflation will be controlled by 2025? 👇
— Truflation (@truflation) March 11, 2025
White House Press Secretary Karoline Leavitt: “Today’s CPI report shows inflation is declining and the economy is moving in the right direction under President Trump. Core consumer prices, which is the best measure of inflation, dropped to its lowest level in FOUR years. This inflation report, much like last week’s jobs report, is far better than the media predicted and the so-called ‘experts’ expected. When will they learn to stop doubting President Trump? As he successfully did in his first term, President Trump is driving down costs through massive deregulation and energy dominance. The entire Trump Administration will continue to focus on fixing the economic and inflation nightmare created by the Biden-Harris Administration to unlock the Golden Age of America.”
Jeffrey Roach, chief economist for LPL Financial, in comments shared with Newsweek: “Core services inflation is unequivocally decelerating, giving the Fed room to focus on the growth mandate. In the near term, we may see some volatility in consumer prices as businesses and consumers anticipate looming tariffs.”
Federal Reserve Chair Jerome Powell, at a recent policy forum in New York: “Despite elevated levels of uncertainty, the U.S. economy continues to be in a good place. The labor market is solid, and inflation has moved closer to our 2 percent longer-run goal.
“Looking ahead, the new Administration is in the process of implementing significant policy changes in four distinct areas: trade, immigration, fiscal policy, and regulation. It is the net effect of these policy changes that will matter for the economy and for the path of monetary policy. While there have been recent developments in some of these areas, especially trade policy, uncertainty around the changes and their likely effects remains high.”
Spencer Platt/Getty Images
Treasury Secretary Scott Bessent, at the Economic Club of New York last week, said that the inflationary impacts of tariffs would be “transitory” if they resulted in a “one-time price adjustment. Across a continuum, I’m not worried about inflation.”
What Happens Next
The next inflation reading from the BLS will be released on April 10.
Update 3/12/25 10:41 a.m. ET: This article was updated with data from Wednesday’s inflation reading from the Bureau of Labor Statistics, and comment from Jeffrey Roach of LPL Financial.
