Outlook shows that the item is already expired and Retention policy seems not deleting these items.This usually happens when Outlook is in cache mode.
if you convert the Outlook in online mode,you would see that the same message would show that it is yet to be expired.
This is because When Outlook is in cache mode,it does use its own algorithm for calculating the expiration date on message.
Microsoft Outlook calculates the value of this property based on the item retention start date and the retention period, if Outlook is in cache or offline mode. The Exchange Server specifies the value if Outlook is in online mode.
Note that the Deleted Items folder is processed bit differently by Retention policy as compared to folders like Inbox,therefore this issue is most likey to happen with Deleted items folder.
Hope this helps!!!