President Donald Trump has been in power for the length of a cup of coffee, yet he still has not resolved the eggflation crisis. No yolk! With egg prices failing to decline in the new administration's opening days, the walls could be closing in on Trump. While this is hyperbolic language emanating from his four years living at 1600 Pennsylvania Ave, this sentiment is shared by scores of lawmakers who are outraged that Trumponomics 2.0 has not reversed the 24% increase in food inflation over the last few years.
Examining Eggflation
Three days after Trump's inauguration, Rep. Jasmine Crockett (D-TX) posted in earnest on a social media platform that prices for various goods and services, including eggs, have increased under the president. A chorus of senators penned a letter to Trump demanding action on rocketing egg prices, writing: “We urge you to make good on your campaign promise to lower food prices for American families.” Even CBS personality Margaret Brennan tried to stump Vice President JD Vance for not already lowering food prices.
The comical part is that the data they have cited are from before Trump returned to the Oval Office. If critics wish to be taken seriously, they should at least wait until the Bureau of Labor Statistics publishes the January or February consumer price index or producer price index numbers.
That said, eggflation has returned to the forefront of business news. The US Department of Agriculture published its 2025 outlook, projecting that egg prices could rise by 20% this year and farm-level egg prices would soar by 45% in 2025. As of December 2024, the average cost of a dozen large, grade-A eggs was $4.16, a near-two-year high.
Over the last few years, various factors have triggered intense monthly price fluctuations. The most notable cause has been the highly pathogenic avian influenza (HPAI) outbreak in early 2022, also known as the bird flu. Additionally, cage-free eggs have been the most impacted, accounting for two-thirds of all cases, despite representing just 33% of all US egg layers.
Input costs have played an outsized role in soaring egg costs. A separate USDA report concluded that real (inflation-adjusted) domestic farm production expenses exceeded $453 billion last year, up from $418 billion before the pandemic. Feed, labor, fuel, and oil expenses have been elevated in recent years, though they did ease in 2024.
Running the Printing Press
The Federal Reserve's printing press ran overtime in 2024 as the nation's money supply rose every month. From January to December, the M2 money supply — a measure of all money circulating the US economy — rose approximately $700 billion to $21.53 trillion, the highest level since August 2022.
Unsurprisingly, the annual inflation rate has increased each month since the Federal Open Market Committee (FOMC) launched a new easing cycle in September. Last month, the consumer price index reached 2.9%, the third straight monthly jump. Estimates vary, but next month’s report could show a 3% or flat reading.
But why does the printing press matter anyway? Remember, the original definition of inflation indicates an expansion of the money supply, with higher prices directly resulting from these monetary actions. The freshly created money forces businesses and consumers to bid up prices, creating a situation where too much money is chasing too few goods. Additionally, those closest to the Fed spigot, such as Wall Street, Big Tech, or the banking system, will benefit the most from the newly minted dollars, which erode in value as they travel through the marketplace.
Bad News for Donald Trump
Despite President Trump’s November victory, consumers are not feeling confident.
The widely watched Consumer Confidence Index from The Conference Board declined by 5.4 points in January to 104.1, from the upwardly revised December print of 109.5. Both the Present Situation Index and the Expectations Index slumped this month on softer labor market projections, said Dana M. Peterson, the chief economist at The Conference Board.
"Notably, views of current labor market conditions fell for the first time since September, while assessments of business conditions weakened for the second month in a row," Peterson said in a statement. "Meanwhile, consumers were also less optimistic about future business conditions and, to a lesser extent, income. The return of pessimism about future employment prospects seen in December was confirmed in January.”
For the 47th president to return confidence levels to where they were in his first term will likely take more than cracking the eggflation conundrum.
.jpg&w=1920&q=75)
.jpg&w=1920&q=75)
