President Donald Trump is reportedly seeking policy wins amid a challenging economic climate and declining approval ratings. The U.S. economy recently slowed to an annualized growth rate of 1.5% in the second quarter, a significant drop from the 2.1% growth seen in the first three months of the year. This slowdown is attributed to the ongoing war in Iran, which has disrupted energy markets and supply chains, leading to increased costs for everyday goods and services, such as groceries and airfares. Analysts had forecasted a growth rate of 2% to 2.1%, making the 1.5% figure an unwelcome surprise.
The economic downturn is further compounded by new tariffs. Earlier this year, the Trump administration imposed tariffs ranging from 10% to 12% on goods from over 80 countries. Although a federal trade court ruled these global import taxes unlawful in May, Trump has vowed fresh tariffs. While economists don't foresee these tariffs triggering a full economic downturn, they anticipate they will act as a drag on growth and increase consumer costs, with a Yale analysis estimating an additional annual burden of approximately $1,100 per household. Despite these challenges, consumer spending and business investment, particularly in the artificial intelligence sector, have shown some resilience.
Public sentiment is also turning unfavorable for Trump. His approval ratings have hit record lows, with a Quinnipiac University poll on July 29 showing a 32% approval, and an AP-NORC poll on July 30 showing 33% approval. Both polls mark his worst performance since returning to the White House in 2025. Furthermore, about two-thirds of U.S. adults believe the war in Iran, which began on February 28, has not been worthwhile. The Federal Reserve, despite pressure, left interest rates unchanged, though three of 12 policymakers dissented, voting for a hike due to growing concerns about persistent inflation.
