February 12, 2025
President Trump promised to bring down prices on day one – but this is not the news he wanted to hear. Inflation is going in the wrong direction – up.
This morning – we got the latest consumer price index report and it found everything we buy, eat and use increased 3% between January of this year and January last year. It also increased half a percent between December and January. To be clear – the federal reserve’s goal is to have inflation at 2% year over year. It’s 3%.
So what’s going on? Well – the Bureau of Labor Statistics found shelter, gasoline and food causing are causing the issues. Shelter continues to increase. This is not a new trend — but in January shelter was up (4.4% yoy/+0.4 mom) from last year. The gasoline index is basically flat (-0.02) between January 2024 and January 2025 – but between December and January, it jumped (1.8% yoy) and the cost of food is definitely up. The grocery index is up (2.5%/ +0.4% mom) between January 2024 and January 2025 and the index for food at restaurants is also up almost 2-percent year over year (1.9% yoy/+0.5%mom).
And I hope you’re sitting down for this one. Egg prices. I don’t think i’ve ever seen numbers like this on a cpi report. The egg index is up 53% between January 2024 and January 2025 and between December and January they’re up (15.2%). Now – of course that has a lot to do with the bird flu which has led to egg shortages across the country.
But it’s not just that – we’re also seeing increases in car insurance (+11.8% you/+2% mom), prescription drugs (4.5%yoy/2.5% mom) and plane tickets (+7.1 yoy/1.2% mom). There are some decreases to tell you about too — including for things like smartphones (-12.3%yoy/-0.5%mom), and household furnishings (-8.3%yoy/-1.5%mom).
Now – before I tell you about what this report is probably going to mean for your interest rates and what president Trump has to say about that — I want to make sure you know you should be signed up for my FactsHQ email. I send that every single day and I give you all the resources for every single story I cover and so much more. Look we don’t know what’s going to happen with TikTok – so signing up for the free FactsHQ email is the best way for you to continue to get news from me. Do that right after you watch this video.
Ok – now back to your interest rates. Today – president trump posted this to his social media page “interest rates should be lowered, something which would go hand in hand with upcoming tariffs!!! Lets rock and roll, America!!!”
Just yesterday – the fed chairman’s testified in front of a senate committee and he said – that’s not going to happen.
That’s the Fed chairman’s polite way of saying inflation is not going in the right direction. There is a lot of uncertainty about how trump’s tariff policy and immigration policy is going to effect the economy and if rates are lowered too soon, we are going to see inflation spike back up big time and things are going to get much much worse. So—they’re going to be keeping rates at this level for a while longer. It’s economics 101. It’s also true that this report only accounts for 11 days of the Trump presidency, but those were pretty eventful days full of big economic policy changes. So we will get a better picture of how exactly the trump policies are effecting the US economy next month.
Meanwhile, senator Kennedy a republican from Louisiana said the American people should feel good about this economy and the federal reserve and the chairman should be commended for their efforts to keep things so steady.
Read the inflation report here.
