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President Donald Trump’s economic agenda has produced a mixed but closely watched set of results so far. Economic growth has picked up, inflation has cooled from recent highs and major policy changes have begun to reshape the outlook for businesses and households.
U.S. stocks rally
Not to mention a strong year for U.S. stocks, with the S&P 500, the broadest measure of the stock market, ending 2025 with a gain of 17%.
Here’s a look at the key developments defining Trump’s economy to date.
Strong growth, easing inflation
The economy grew faster than expected in late 2025, with overall output rising at an annual pace of about 4% to 4.5% in the third quarter. Trump administration officials say that growth was driven by Americans spending more money and businesses feeling confident enough to invest and hire.
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At the same time, inflation, the pace at which prices rise, has cooled.
Prices rose 2.7% in November, compared with a year earlier, less than the 3.1% economists had estimated.
Together, those trends could shape how Trump and the Federal Reserve approach interest rates and the broader economy in the months ahead. Market watchers are forecasting the Fed’s first rate cut will come in April 2026, according to the CME’s FedWatch Tool, which tracks the probability of rate moves.
Trump’s One Big Beautiful Bill Act
Signed into law on July 4, Trump’s flagship One Big Beautiful Bill Act (OBBBA) is a far-reaching tax and spending measure that builds on the 2017 Tax Cuts and Jobs Act (TCJA) from his first term while launching new federal initiatives.
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The legislation extends expiring TCJA tax cuts, preventing a broad tax increase for individuals and makes permanent lower income tax rates and an expanded standard deduction. Other provisions are extended temporarily, reshaping the tax landscape for households and businesses.
The bill also clears the way for campaign pledges like “No Tax on Tips” and “No Tax on Overtime” to take effect in 2026, while introducing new long-term savings programs.
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Big tax refunds
Trump’s economic team is telling Americans to prepare for some of the biggest tax refunds in history, as a result of provisions in the OBBBA.
“I can see that we’re gonna have a gigantic refund year in the first quarter, because working Americans did not change their withholdings,” U.S. Treasury Secretary Scott Bessent told the “All-In Podcast” hosts. “I think households could see, depending on the number of workers, $1,000 to $2,000 refunds.”
Bessent’s prediction echoes that of the Tax Foundation, a nonpartisan tax policy nonprofit. The group said in a Dec. 17 report that “refunds will be larger than typical in the upcoming filing season because of the One Big Beautiful Bill Act’s (OBBBA) tax cuts for 2025.”
Trump accounts
For kids, the accounts function much like traditional long-term investment vehicles but with rules specifically designed to protect young savers. Available only to those under 18, they’re funded through federal seed money, private contributions from families and, when applicable, supplemental deposits from employers or nonprofit organizations.
Individuals can contribute up to $5,000 per year to a Trump account. Governments and nonprofits may also make eligible contributions. In addition, funds from another Trump account may be rolled over, meaning money already held in one Trump account can be transferred directly into a new or different Trump account without counting toward the annual contribution limit.
Employers participating in a Trump account program may contribute up to $2,500 per year.
In December, two prominent billionaires joined funding for Trump accounts. Michael and Susan Dell were the first to pledge over $6 billion. Later, investor Ray Dalio joined the cause.
Launch of ‘Liberation Day’ tariffs
In April, Trump announced sweeping “Liberation Day” tariffs aimed at reducing long-standing trade imbalances, reviving U.S. manufacturing and strengthening national security. Critics countered that higher tariffs could raise consumer prices and provoke retaliation from trading partners.
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Even so, total duty revenue reached $215.2 billion in fiscal year 2025, which ended Sept. 30, according to the Treasury Department’s Customs and Certain Excise Taxes report. That momentum continued into the new fiscal year, with $96.5 billion collected since Oct. 1, Treasury data show.
The strategy now faces a legal challenge, with the Supreme Court expected to rule in January on Trump’s authority to impose certain tariffs.
The cases — Learning Resources Inc. v. Trump and Trump v. V.O.S. Selections Inc. — brought by an educational toy maker and a family-owned wine and spirits importer, focus on whether the International Emergency Economic Powers Act grants the president that power or exceeds constitutional limits.
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The president maintains, however, that aggressive tariffs are necessary to confront what he considers years of unfair global trade, a stance that shows how firmly trade policy is embedded in his broader economic strategy.
Trump has also vowed that revenue generated from duties could fund a $2,000 dividend for low- and middle-income Americans.
