The US Republicans under President Trump are threatened with a debacle in the upcoming midterm elections in November. They could lose their majority in both chambers of Congress and Trump could lose the basis of his power. The reason for this: among other things, a series of miserable economic data.
It was almost exactly two years ago that Donald Trump promised to lower prices in the USA "very quickly" if he won the presidential election. He will defeat inflation and trigger “explosive economic growth,” said Trump. People were left with a massive price shock from the pandemic, which they attributed to incumbent Democrat Joe Biden. Trump won the election.
Two years after Trump's victory, the USA is heading towards an election again, prices are climbing again and the issue of inflation is again beginning to shift the political balance of power. Only this time to Trump's disadvantage.
If the Republicans lose one of the two chambers of Congress on November 3rd, they will lose the majority in the House of Representatives or the Senate; Democrats could block Trump's legislative proposals in his final two years in office.
When he took office, Trump promised to instruct his cabinet members to do everything they could to combat the record inflation he complained about. But he didn't just promise to stabilize prices: they should fall.
In fact, the inflation rate temporarily fell. It fell from its peak of 9.1 percent in the summer of 2022 to 2.3 percent in April 2025. But prices did not fall because of this - they just rose more slowly. Promising falling prices was an almost impossible promise and economically undesirable. Trump did it anyway. Now the price rise is accelerating again. Shortly before the midterm elections, the US Census Bureau reported that consumer prices rose 3.7 percent in September compared to the previous year. The goal is an inflation rate of 2 percent; if it is higher, the central bank will be forced to raise interest rates.
More than two-thirds of respondents disapprove of Trump's handling of inflation. Only around a third of those surveyed agree with his economic policy. Trump has an obvious problem. Not only are the majority of US voters dissatisfied with Trump's economic policy, according to a Pew survey, they also agree that this plays a role in their voting decision.
"My plan will halve energy prices"
Two defining elements of Trump's second presidency are at least partially to blame for the price rise: tariffs and the war against Iran, which the majority rejects. Analyzes by the US Federal Reserve and its regional institutes show that the tariffs have noticeably increased inflation. By February 2026, ordinary consumer goods such as cars, furniture and clothing had become more expensive by a total of 3.1 percent.
However, the studies have limitations: the effect on overall US inflation is significantly smaller. Dealers and importers would have absorbed some of the additional costs at the expense of their profit margins. In addition, the tariffs would have increased the price level primarily on a one-off basis instead of driving up inflation permanently.
According to experts, the tariff effect has been losing force since mid-2026. Higher energy prices were recently primarily responsible for the renewed increase in overall inflation. Trump promised a good two years ago: "My plan will cut energy prices in half or even more within twelve months of taking office."
But on February 28, 2026, the USA and Israel attacked Iran. They fired hundreds of rockets, dropped bombs on bunkers, and killed much of the Iranian leadership and hundreds of civilians. Iran then closed the Strait of Hormuz, cutting off the world market from one of its most important sources of crude oil. The prices for gasoline, diesel and heating oil rose noticeably - also in the USA.
Gas prices drive inflation
That drives inflation. The US statistics agency attributes half of the latest increase in consumer prices by a seasonally adjusted 0.6 percent to the jump in prices at gas stations. Gasoline prices rose by an average of 9.1 percent within a month. A beacon in the car country USA.
How expensive it is to refuel varies greatly from region to region in the USA. Gasoline costs the most in California. Stricter environmental regulations and poor pipeline connections are driving up prices there. In general, fuel is more expensive on the east and west coasts than in the interior, because that is where oil production areas lie.
After a conversation with Russian President Vladimir Putin last week, Trump announced that Russia would "immediately" provide 300,000 tons of diesel for the US and the global market. But the diesel from the deal with Putin is unlikely to change much. It may not even arrive in time for the midterm elections. And even if it does: whether delivery will lower the price is uncertain. If Russia diverts current deliveries to this end, the fuel will be missing elsewhere. The price is determined on the world market, and it remains tense. The International Energy Agency expects a diesel shortage until mid-2027. Prices on the futures market also only reacted briefly to Trump's announcement. Then they rose again.
High energy costs are driving inflation and are likely to force the US Federal Reserve to raise interest rates again this year. Several central bank representatives have already indicated this publicly. The next meeting is at the end of October, shortly before the midterms. According to most experts, the Fed will probably wait and then raise interest rates in December.
Rising interest rates affect people's pockets more quickly in the USA than in Europe. A comparatively large number of people pay mortgage interest and finance their daily expenses on credit. If the central bank's key interest rate rises, the interest on your home or loan usually follows suit.
Inflation, fuel prices, rising interest rates - these are all measures of an impression that most voters can sum up: things are becoming more expensive. A survey by the University of Michigan shows how entrenched this impression is month after month. She surveys a cross-section of US society and determines how willing people are to consume. The result is an index - a single number that shows at a glance how the economic mood in the country is developing. This mood was consistently good at Trump's inauguration. The index value has now reached lows in two out of three income groups; the downturn in mood is only limited among high earners.
