Months of President Donald Trump launched his commercial war, economic data continues to give mixed signals about the amount of definitions that affect prices in the United States
Although the consumer price index has risen up, it has been constantly expecting expectations, although the most recent reading of the prices of producers was surprised to land.
Some sectors that are largely exposed to tariffs witnessed the definitions of mutations, but the July data showed less prices on some goods and more pressure on some services.
“Despite these packages, the impact of customs tariffs on consumer prices can be said that it was less worse than expected so far,” Economists at JPMorgan, led by Michael Ferrol, said in a Friday memo.
According to the bank, one of the possible explanations for silent inflation numbers is that companies deal with the cost of customs tariffs at the expense of their profit margins, which are currently according to historical standards and can accommodate additional costs without harming capital budgets or operation.
Other explanations include delay in the late effects of prices on prices, as companies decline in pre -conflict stocks, and the season of prices, as inflation during the summer tends to be more soft than they were in the winter, and adds the costs of customs tariffs through services instead of goods instead of goods.
Another explanation may be that the importers of definition rates are already paying much less than the address numbers. accident Barclays The report found that the weighted medium tax in May was only 9 % compared to the bank’s estimate by 12 %.
This is because the demand has turned away from countries with higher customs tariffs while more than half of the United States’ imports in that month were free of drawing. Despite the high rates in Canada, for example, it does not apply to the goods covered by the American Trade, Mexico and Cananga agreement.
The report said: “The real surprise in the elasticity of the American economy does not lie in its reaction to the customs tariff, but the rise in the rate of effective tariff was more modest than it was usually believed.”
Barclays certainly said that the weighted average rate has risen to 10 % today and is expected to eventually settle by about 15 %, as it is expected that more products such as pharmaceutical products are expected to be exposed to nearby gaps.
Companies opposite consumers
Citi Research still does not see much evidence of price pressure on a wide range of customs tariffs and attributed the last height of services to anomalous cases once, such as 5.8 % of the portfolio management fees due to the asset prices.
CITI also does not expect consumers to be affected by a significant increase in prices in the future, so that more fees are expected to be offered.
“The most softening demand means that companies will face difficulty in transferring tariff costs to consumers.” “Although some companies may still try to increase prices slowly in the coming months, the experiment indicates that these increases will be modest in size. This must reduce concerns about the upward risks to inflation and increase fears that profit margins will lead to low companies when employment.”
In contrast to that, Goldman Sachs expected that consumers will pay most of the tariff costs. As of June, they absorb 22 %, but this number should jump to 67 % by October if the pattern that was seen in the early rounds of Trump’s commercial actions continues.
For companies, the burden will shrink from 64 % to 8 %, while foreign suppliers will see an increase from 14 % to 25 % of the effect of customs tariffs.
Discovering ambiguity about what the customs tariff – or not doing – for inflation has significant effects on the federal reserve, which tries to balance both sides of its double mandate.
The inflation definitions remained stubborn than the Federal Reserve’s goal by 2 %, causing policy makers on price cuts. But the weakness in the jobs has sparked data on employment, which leads to the supply of demands by mitigation.
“The evidence so far is that all the costs of definitions are generated by local companies,” Holnhourist wrote from City. “The lack of success should reduce official inflation concerns in the Federal Reserve and allow a series of discounts in prices that start in September. If anything is markets that reduce the possibility of faster and/deeper discounts.”
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