(TNND) — A new Gallup survey shows higher economic optimism among Americans, with the positivity fueled by improved Republican sentiment.

Gallup asked people Jan. 2-15 about their expectations over the next six months for economic growth, inflation, interest rates, unemployment and the stock market.

Americans are the most optimistic they have been in the past seven years about several aspects of the economy, particularly economic growth and the stock market, according to Gallup.

A majority of Americans expect the economy to grow and for stocks to rise.

Most people, 52%, still expect inflation. But Gallup said that is down significantly from recent years.

More people expect lower interest rates than higher interest rates.

And Americans are split on whether unemployment will rise or fall.

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Republicans offered optimistic outlooks in all five economic areas.

Independents offered mixed results. Majorities expected economic growth and stock market improvements. But a majority of independents also expected consumer prices to rise, and more independents expected unemployment to rise.

Democrats offered the least optimistic outlooks. Just over half of Democrats believe the stock market will increase in the next six months, but Democrats were more negative than positive on the other four questions.

Optimism among Republicans is up considerably compared to two years ago.

Now, 78% of Republicans expect economic growth, compared to 19% who expected the same in a 2023 survey.

“Two things jumped out at me from the poll,” said Peter Loge, the director of the School of Media and Public Affairs at George Washington University. “The first is, people who voted for Donald Trump. Donald Trump was elected. They think good things are going to happen. So, we carry our political biases with us. The second thing that really jumped out is when the poll was done. The survey was in the field the first week of January ... A lot has happened in the past couple of weeks. And I'd be really interested to see how people feel about the economy if they were surveyed today or over the weekend or come tomorrow. This is an administration that is moving very, very quickly. And I think the American people, to the extent they're paying attention, are having trouble keeping up.”

Inflation played a big role in the election.

Among voters who said high prices were the most important factor in their vote, nearly two-thirds broke for Trump, according to AP VoteCast surveys.

Those inflation-focused voters were looking for a change from President Joe Biden.

“I think inflation was part of it,” Loge said. “I think it was inflation, immigration and chaos. Stuff cost more. The southern border seemed out of control. The world seems a little bit chaotic. Stuff wasn't working. And if stuff isn't working, you fire the coach.”

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James Knightley, ING’s chief international economist, said Trump’s policies could result in a low-taxation environment, lighter-touch regulations, higher tariffs, and lower levels of immigration.

And all of those could impact our economy and our wallets.

Trump has dispatched federal authorities to make good on his campaign promise to deport illegal immigrants, especially those accused of crimes.

U.S. Immigration and Customs Enforcement has announced thousands of arrests in the first two weeks of Trump’s presidency.

And Trump’s “border czar” Tom Homan said the crackdown has resulted in a 93% reduction in border crossings since Trump took office.

Knightley said workforce growth and productivity increases fuel economic growth, but that is made harder by falling American birth rates.

Unless our labor-force participation rate improves or we see productivity gains from technology, such as artificial intelligence, we might need the labor growth from immigrants to help grow our economy.

Knightley said the long-term decline of restricted immigration would likely have a greater impact on the U.S. economy than the number of illegal immigrants who are being deported at the moment.

Tariffs are another big Trump policy position making headlines, with 25% additional tariffs set to go into effect on Canada (except energy resources) and Mexico and a 10% additional tariff on imports from China.

Trump agreed Monday to pause tariffs on Mexico after Mexican President Claudia Sheinbaum agreed to send 10,000 national guard soldiers to the border to address drug trafficking.

“These soldiers will be specifically designated to stop the flow of fentanyl, and illegal migrants into our Country,” Trump said in a Truth Social post. “We further agreed to immediately pause the anticipated tariffs for a one month period during which we will have negotiations headed by Secretary of State Marco Rubio, Secretary of Treasury Scott Bessent, and Secretary of Commerce Howard Lutnick, and high-level Representatives of Mexico. I look forward to participating in those negotiations, with President Sheinbaum, as we attempt to achieve a ‘deal’ between our two Countries.”

Knightley said he’s concerned about the possibility of tariffs, but he said there’s a great deal of uncertainty with the scope or duration of tariffs.

It’s certainly possible that Trump will drop the threat of tariffs if he gets other concessions from countries. That happened when Colombia agreed to accept flights of deported migrants.

“Maybe the dealmaker-in-chief is working his magic,” Knightley said. “But we’ll just have to see how this unwinds. But certainly, there's a lack of visibility, a real lack of clarity as to what's going on here. Are we going to get tariffs? Are we not going to get tariffs? ... What will be the impact?”

If we do get tariffs, Americans should expect to see higher prices, Knightley said.

“Because, of course, the tax is paid for by the importing company,” he said. “And it's going to be likely, a lot of it, will be passed on to you and I.”

Knightley said tariffs would put a “squeeze on spending power,” with the announced tariffs on Canada, Mexico and China costing every American man, woman and child an extra $835 this year in the “worst case scenario.”

Some of that impact could be blunted by consumers switching to American-made goods or companies trying to absorb some of the higher costs.

But Knightley said our manufacturing sector isn’t big enough to replace all the imported goods we consume.

The total value of U.S. manufacturing output in 2023, the most recent full-year figures available, was about $2.9 trillion. That same year, we imported $3.1 trillion in foreign goods.

“To offset those foreign products, we've got to more than double the manufacturing sector,” Knightley said. “And that's just not feasible within a few months. That's going to take a decade-plus, if that was to be achieved.”