Yardeni Research president Ed Yardeni discusses the top economic drivers in 2026 ‘Making Money.’
The president Donald Trump’s The economic agenda has produced mixed but widely viewed results so far. Economic growth has picked up, inflation has eased from recent highs and major policy changes have begun to reshape the outlook for businesses and households.
US stocks rally
Not to mention a strong year for US stocks, with the S&P 500, the broadest measure of the stock market, ending 2025 with a 17% gain.
Here’s a look at the key developments that define Trump’s economy so far.
Strong growth, low inflation
The economy grew faster than expected by the end of 2025, with the overall output increasing at a pace of about 4% to 4.5% in the third quarter. Trump administration officials say growth is being driven by Americans spending more and businesses feeling confident enough to invest and hire.
RESERVED COUNTRIES SEE LOWER INFLATION THAN FREE NATIONALS, WHITE HOUSE DATA SHOWS
At the same time, inflation, the rate at which prices rise, has cooled.
Prices rose 2.7% in November, compared to a year ago, below the 3.1% economists had estimated.
Together, those conditions could change the way Trump and the The Federal Reserve approach to interest rates and the broader economy in the coming months. Market watchers predict the Fed’s first rate cut will come in April 2026, according to CME’s FedWatch Tool, which tracks the likelihood of a rate hike.
Trump’s One Big Beautiful Bill Act
US President Donald Trump, joined by Republican lawmakers, signed the One, Big Beautiful Bill into law during the Independence Day military family picnic on the South Lawn of the White House on July 4, 2025. (Photos by Samuel Corum / Getty Images)
Signed into law on July 4, Trump’s flag One Big Good Bill (OBBBA) far-reaching tax and spending measures built into the Tax Cuts and Jobs Act of 2017 (TCJA) since his first term while introducing new federal initiatives.
THE FIVE BIG PRINCIPLES YOU SHOULD KNOW IN THE ONE BIG GOOD BILL
The legislation extends the TCJA’s expiring tax cuts, prevents broad tax increases for individuals and makes lower incomes permanent. tax rates and extended general deductions. Some provisions are extended temporarily, to adjust the tax situation of households and businesses.
The bill also paves the way for campaign promises like “No Tax on Tips” and “No Tax on Overtime” to take effect in 2026, while introducing new long-term savings plans.
IRS OUTLINES NO TAX ON TIPS
Major tax refunds
Trump’s economic team is telling Americans to prepare for the largest tax refund in history, thanks to provisions in the OBBBA.
“I see that we’re going to have a lot of money coming back in the first quarter, because working Americans didn’t change their holdings,” US Treasury Secretary Scott Besent told the hosts of the “All-In Podcast”. “I think households could see, depending on the number of employees, a $1,000 to $2,000 refund.”
Bessent’s prediction proves that of Tax Basisnon-profit tax policy. The group said in a Dec. 17 report that “refunds will be larger than usual in the upcoming filing season due to the One Big Beautiful Bill Act’s (OBBBA) tax cuts in 2025.”
Trump account
For children, the accounts serve as long-term investment vehicles but have rules designed to protect them young people. Available only to those under the age of 18, they are funded by the organization’s seed money, private donations from families and, where appropriate, additional deposits from employers or non-profit organizations.
People can contribute up to $5,000 a year to Trump’s account. Governments and non-profit organizations can also contribute appropriately. In addition, funds from another Trump account may be transferred, meaning that money already held in one Trump account can be transferred directly to a new or different Trump account without counting the annual contribution limit.
Employers participating in the Trump account program can contribute up to $2,500 per year.
Michael Dell (L), CEO of Dell Technologies, and his wife Susan (2nd-L) speak during the announcement of a $6.25 billion donation from the Dell family to the “Trump Accounts,” in the Roosevelt Room of the White House in Washington, DC, on December 2, 2020. (Andrew Caballero-Reynolds/AFP/Getty Images/Getty Images)
In December, two prominent billionaires joined in funding Trump’s accounts. Michael and Susan Dell were the first to make an offer in excess of $6 billion. Later, investor Ray Dalio joined the cause.
Launch of ‘Independence Day’ tax
President Donald Trump announces the tariffs during a ceremony in the Rose Garden at the White House. (Brendan Smialowski/AFP via Getty Images/Getty Images)
In April, Trump announced “Independence Day” tariffs aimed at reducing long-standing trade imbalances, boosting US manufacturing and strengthening national security. Critics argue that higher tariffs would raise consumer prices and trigger retaliation from trading partners.
TRUMP SAYS INCOME TO PAY $2K CHECKS TO AMERICANS, LOW NATIONAL DEBT AT $38T
However, total revenue reached $215.2 billion in fiscal year 2025, which ended September 30, according to a report by the Ministry of Finance’s Customs and Some Excise Taxes. That momentum continued into the new fiscal year, with $96.5 billion raised as of Oct. 1, Treasury data show.
The plan is now facing a legal challenge, as the Supreme Court is expected to rule in January on Trump’s authority to impose certain taxes.
Cases — Learning Resources Inc. v. Trump and Trump v. VOS Selections Inc. — brought to you by an educational toy maker and family-owned wine and spirits retailer, focused on International Emergency Economic Powers Act empowers the president or oversteps the bounds of the constitution.
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However, the president insists that aggressive tariffs are necessary to address what he considers years of unfair trade around the world, a situation that shows just how entrenched it is. trade policy focused on his broader economic plans.
Trump also vowed that revenue from jobs could fund a $2,000 in dividends for low- and middle-income Americans.
