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Yahoo
13-05-2025
- Business
- Yahoo
Inflation cools in April and egg prices drop to lowest mark in months - but fears remain tariffs could spike prices
Inflation cooled slightly in the last 12 months through April and egg prices dropped to the lowest in months, but fears over the impact of President Donald Trump's global trade tariffs remain. Consumer prices have risen 2.3 percent in April compared with a year earlier, according to the Department of Labor. April's consumer-price index report is the first to capture the aftermath of Trump's 'Liberation Day' tariff announcements on April 2, causing the stock market to plummet, and the picture is unclear. Economists say it will likely take more time for the full impact of Trump's trade tariffs to be reflected in prices across the U.S. On a monthly basis, prices rose modestly, increasing 0.2 percent from March to April after falling 0.1 percent the previous month. Grocery prices fell 0.4 percent, pulled down in part by a big 12.7 percent drop in the price of eggs, which was the first decline in price in months. The report suggests the tariffs haven't yet impacted the prices of many items. Clothing costs fell 0.2 percent from March to April, while new car prices were unchanged. Furniture costs jumped 1.5 percent, however. The president has long argued that his global tariffs will boost American manufacturing and increase U.S. jobs. 'In the end it's going to be a beautiful thing,' Trump said last month. But economists have warned that it is the American people who will suffer higher prices. Economists are viewing this month's report as a way of 'testing the waters.' 'Firms have indicated ... that they are unsure how much of the tariff cost increase they can pass through to consumers without denting demand, and we expect some testing of the waters and a staggered pattern of price increases,' Laura Rosner-Warburton, cofounder of Macro Policy Perspectives, wrote in a note to clients. It comes as the U.S. and China agreed Monday to call a temporary truce to the trade war. The U.S. agreed to slash the tariff on Chinese imports to 30 percent from its current 145 percent and China, in return, agreed that it would lower its levies on American goods to 10 percent from 125 percent. Both nations would suspend their respective tariffs for 90 days as negotiations continue. But even taking that agreement into account, U.S. average import taxes remain at 90-year highs, economists said, which could worsen inflation in the coming months. Consumer prices cooled noticeably in February and March, prompting Trump to claim repeatedly on social media that there is 'NO INFLATION.' Inflation has fallen to nearly the 2 percent target set by the Federal Reserve, the agency charged with fighting higher prices. Inflation fell for the first time in nearly five years the previous month. AP contributed
The Hill
13-05-2025
- Business
- The Hill
Tariffs may have pushed up inflation a bit in April, government report to show
WASHINGTON (AP) — Inflation may have picked up slightly last month as President Donald Trump's widespread tariffs kicked in, a trend economists expect will become more visible in the coming months. Consumer prices are forecast to have risen 2.4% in April compared with a year earlier, according to data provider FactSet, the same as in March and down from 3% at the start of the year. Still, on a monthly basis, economists expect that the consumer price index rose 0.3% from March to April, a pace that would worsen inflation if it continued, after it fell for the first time in nearly five years the previous month. Tuesday's report could provide an early read on how Trump's duties will affect the prices Americans pay for necessities and other goods such as clothing, shoes, furniture and even groceries. Duties on many goods from Mexico and Canada took effect in February and could have impacted prices last month. Still, economists forecast the impact from duties to be modest. 'Firms have indicated … that they are unsure how much of the tariff cost increase they can pass through to consumers without denting demand, and we expect some testing of the waters and a staggered pattern of price increases,' Laura Rosner-Warburton, cofounder of Macro Policy Perspectives, wrote in note to clients. The Trump administration said early Monday that it had reached a deal with China to sharply reduce its tariffs on imports from that country. But even taking that agreement into account, U.S. average import taxes remain at 90-year highs, economists said, which could worsen inflation in the coming months. Tariffs on furniture, agricultural goods from Mexico, and on clothes and shoes may have boosted prices last month. Auto prices may have risen because car sales surged as Americans sought to get ahead of duties on new cars and car parts, reducing the need for dealers to offer discounts. Excluding the volatile food and energy categories, core prices are forecast to have risen 2.8% last month compared to a year earlier, the same as in March. On a monthly basis, they are expected to rise 0.3%, up from just 0.1% the previous month. It will likely take more time for the full impact of the duties to be reflected in prices across U.S. businesses, economists say. Items that were already in transit when the tariffs were imposed won't have to pay the duties, while many companies have built a stockpile of goods and could hold off on price hikes in hopes that tariffs will ultimately be reduced. Consumers, at least those outside the top one-fifth in incomes, are also more stretched financially than a few years ago and are more likely to resist price hikes, which could push firms to delay raising prices as long as possible. Consumer prices cooled noticeably in February and March, prompting Trump to claim repeatedly on social media that there is 'NO INFLATION.' Inflation has fallen to nearly the 2% target set by the Federal Reserve, the agency charged with fighting higher prices. Yet grocery prices have jumped in two out of the past three months, despite Trump's claims. He has also said gas has fallen to $1.98 a gallon, which is below the measured average in any state. AAA said Monday that gas costs an average $3.14 a gallon nationwide. On Monday, the White House said it has cut the tariff it imposed on Chinese goods from 145% to 30%, while China also sharply reduced its duties on U.S. goods. Both sides could add 24% tariffs after 90 days if they don't reach a broader agreement. The smaller import taxes will limit the damage to the U.S. economy, but combined with a 10% universal tariff already in place, plus larger import taxes on autos, steel, and aluminum, economists forecast they will still slow growth this year and worsen inflation. The Yale Budget Lab, for example, estimates that the average U.S. tariff will be nearly 18% even including the deal reached Monday between the U.S. and China. At that level, U.S. duties will be the highest since 1934. The Budget Lab calculates the tariffs will lift prices 1.7% and cost the average household about $2,800. And while Trump may tout his trade deals — such as the one with the United Kingdom reached last week — he has also said 'tariffs is the most beautiful word' in the dictionary, and is counting on revenue from duties to narrow the budget deficit, suggesting tariffs will likely remain high. The tariffs have also put the Federal Reserve in an exceedingly difficult spot, as Chair Jerome Powell acknowledged in a news conference last week. Powell said the duties have raised the risk of both higher inflation and higher unemployment, two challenges that rarely occur simultaneously. If unemployment rose, the Fed would typically cut rates to boost the economy, while if inflation worsened, the central bank would usually raise rates or leave them elevated.
The Independent
13-05-2025
- Business
- The Independent
Tariffs may have pushed up inflation a bit in April, government report to show
Inflation may have picked up slightly last month as President Donald Trump 's widespread tariffs kicked in, a trend economists expect will become more visible in the coming months. Consumer prices are forecast to have risen 2.4% in April compared with a year earlier, according to data provider FactSet, the same as in March and down from 3% at the start of the year. Still, on a monthly basis, economists expect that the consumer price index rose 0.3% from March to April, a pace that would worsen inflation if it continued, after it fell for the first time in nearly five years the previous month. Tuesday's report could provide an early read on how Trump's duties will affect the prices Americans pay for necessities and other goods such as clothing, shoes, furniture and even groceries. Duties on many goods from Mexico and Canada took effect in February and could have impacted prices last month. Still, economists forecast the impact from duties to be modest. 'Firms have indicated ... that they are unsure how much of the tariff cost increase they can pass through to consumers without denting demand, and we expect some testing of the waters and a staggered pattern of price increases,' Laura Rosner-Warburton, cofounder of Macro Policy Perspectives, wrote in note to clients. The Trump administration said early Monday that it had reached a deal with China to sharply reduce its tariffs on imports from that country. But even taking that agreement into account, U.S. average import taxes remain at 90-year highs, economists said, which could worsen inflation in the coming months. Tariffs on furniture, agricultural goods from Mexico, and on clothes and shoes may have boosted prices last month. Auto prices may have risen because car sales surged as Americans sought to get ahead of duties on new cars and car parts, reducing the need for dealers to offer discounts. Excluding the volatile food and energy categories, core prices are forecast to have risen 2.8% last month compared to a year earlier, the same as in March. On a monthly basis, they are expected to rise 0.3%, up from just 0.1% the previous month. It will likely take more time for the full impact of the duties to be reflected in prices across U.S. businesses, economists say. Items that were already in transit when the tariffs were imposed won't have to pay the duties, while many companies have built a stockpile of goods and could hold off on price hikes in hopes that tariffs will ultimately be reduced. Consumers, at least those outside the top one-fifth in incomes, are also more stretched financially than a few years ago and are more likely to resist price hikes, which could push firms to delay raising prices as long as possible. Consumer prices cooled noticeably in February and March, prompting Trump to claim repeatedly on social media that there is 'NO INFLATION." Inflation has fallen to nearly the 2% target set by the Federal Reserve, the agency charged with fighting higher prices. Yet grocery prices have jumped in two out of the past three months, despite Trump's claims. He has also said gas has fallen to $1.98 a gallon, which is below the measured average in any state. AAA said Monday that gas costs an average $3.14 a gallon nationwide. On Monday, the White House said it has cut the tariff it imposed on Chinese goods from 145% to 30%, while China also sharply reduced its duties on U.S. goods. Both sides could add 24% tariffs after 90 days if they don't reach a broader agreement. The smaller import taxes will limit the damage to the U.S. economy, but combined with a 10% universal tariff already in place, plus larger import taxes on autos, steel, and aluminum, economists forecast they will still slow growth this year and worsen inflation. The Yale Budget Lab, for example, estimates that the average U.S. tariff will be nearly 18% even including the deal reached Monday between the U.S. and China. At that level, U.S. duties will be the highest since 1934. The Budget Lab calculates the tariffs will lift prices 1.7% and cost the average household about $2,800. And while Trump may tout his trade deals — such as the one with the United Kingdom reached last week — he has also said 'tariffs is the most beautiful word' in the dictionary, and is counting on revenue from duties to narrow the budget deficit, suggesting tariffs will likely remain high. The tariffs have also put the Federal Reserve in an exceedingly difficult spot, as Chair Jerome Powell acknowledged in a news conference last week. Powell said the duties have raised the risk of both higher inflation and higher unemployment, two challenges that rarely occur simultaneously. If unemployment rose, the Fed would typically cut rates to boost the economy, while if inflation worsened, the central bank would usually raise rates or leave them elevated.
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Business Standard
13-05-2025
- Business
- Business Standard
Trump tariffs may have pushed up inflation in April, US govt report to show
Consumer prices are forecast to have risen 2.4 per cent in April compared with a year earlier, according to data provider FactSet, the same as in March AP Washington Inflation may have picked up slightly last month as President Donald Trump 's widespread tariffs kicked in, a trend economists expect will become more visible in the coming months. Consumer prices are forecast to have risen 2.4 per cent in April compared with a year earlier, according to data provider FactSet, the same as in March and down from 3 per cent at the start of the year. Still, on a monthly basis, economists expect that the consumer price index rose 0.3 per cent from March to April, a pace that would worsen inflation if it continued, after it fell for the first time in nearly five years the previous month. Tuesday's report could provide an early read on how Trump's duties will affect the prices Americans pay for necessities and other goods such as clothing, shoes, furniture and even groceries. Duties on many goods from Mexico and Canada took effect in February and could have impacted prices last month. Still, economists forecast the impact from duties to be modest. Firms have indicated ... that they are unsure how much of the tariff cost increase they can pass through to consumers without denting demand, and we expect some testing of the waters and a staggered pattern of price increases, Laura Rosner-Warburton, cofounder of Macro Policy Perspectives, wrote in note to clients. The Trump administration said early Monday that it had reached a deal with China to sharply reduce its tariffs on imports from that country. But even taking that agreement into account, US average import taxes remain at 90-year highs, economists said, which could worsen inflation in the coming months. Tariffs on furniture, agricultural goods from Mexico, and on clothes and shoes may have boosted prices last month. Auto prices may have risen because car sales surged as Americans sought to get ahead of duties on new cars and car parts, reducing the need for dealers to offer discounts. Excluding the volatile food and energy categories, core prices are forecast to have risen 2.8 per cent last month compared to a year earlier, the same as in March. On a monthly basis, they are expected to rise 0.3 per cent, up from just 0.1 per cent the previous month. It will likely take more time for the full impact of the duties to be reflected in prices across US businesses, economists say. Items that were already in transit when the tariffs were imposed won't have to pay the duties, while many companies have built a stockpile of goods and could hold off on price hikes in hopes that tariffs will ultimately be reduced. Consumers, at least those outside the top one-fifth in incomes, are also more stretched financially than a few years ago and are more likely to resist price hikes, which could push firms to delay raising prices as long as possible. Consumer prices cooled noticeably in February and March, prompting Trump to claim repeatedly on social media that there is NO INFLATION." Inflation has fallen to nearly the 2 per cent target set by the Federal Reserve, the agency charged with fighting higher prices. Yet grocery prices have jumped in two out of the past three months, despite Trump's claims. He has also said gas has fallen to $1.98 a gallon, which is below the measured average in any state. AAA said Monday that gas costs an average $3.14 a gallon nationwide. On Monday, the White House said it has cut the tariff it imposed on Chinese goods from 145 per cent to 30 per cent, while China also sharply reduced its duties on US goods. Both sides could add 24 per cent tariffs after 90 days if they don't reach a broader agreement. The smaller import taxes will limit the damage to the US economy, but combined with a 10 per cent universal tariff already in place, plus larger import taxes on autos, steel, and aluminum, economists forecast they will still slow growth this year and worsen inflation. The Yale Budget Lab, for example, estimates that the average US tariff will be nearly 18 per cent even including the deal reached Monday between the US and China. At that level, US duties will be the highest since 1934. The Budget Lab calculates the tariffs will lift prices 1.7 per cent and cost the average household about $2,800. And while Trump may tout his trade deals such as the one with the United Kingdom reached last week he has also said tariffs is the most beautiful word in the dictionary, and is counting on revenue from duties to narrow the budget deficit, suggesting tariffs will likely remain high. The tariffs have also put the Federal Reserve in an exceedingly difficult spot, as Chair Jerome Powell acknowledged in a news conference last week. Powell said the duties have raised the risk of both higher inflation and higher unemployment, two challenges that rarely occur simultaneously. If unemployment rose, the Fed would typically cut rates to boost the economy, while if inflation worsened, the central bank would usually raise rates or leave them elevated. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
Boston Globe
13-05-2025
- Business
- Boston Globe
Tariffs may have pushed up inflation a bit in April, government report to show
Get Starting Point A guide through the most important stories of the morning, delivered Monday through Friday. Enter Email Sign Up 'Firms have indicated ... that they are unsure how much of the tariff cost increase they can pass through to consumers without denting demand, and we expect some testing of the waters and a staggered pattern of price increases,' Laura Rosner-Warburton, cofounder of Macro Policy Perspectives, wrote in note to clients. Advertisement The Trump administration said early Monday that it had reached a deal with China to sharply reduce its tariffs on imports from that country. But even taking that agreement into account, U.S. average import taxes remain at 90-year highs, economists said, which could worsen inflation in the coming months. Advertisement Tariffs on furniture, agricultural goods from Mexico, and on clothes and shoes may have boosted prices last month. Auto prices may have risen because car sales surged as Americans sought to get ahead of duties on new cars and car parts, reducing the need for dealers to offer discounts. Excluding the volatile food and energy categories, core prices are forecast to have risen 2.8% last month compared to a year earlier, the same as in March. On a monthly basis, they are expected to rise 0.3%, up from just 0.1% the previous month. It will likely take more time for the full impact of the duties to be reflected in prices across U.S. businesses, economists say. Items that were already in transit when the tariffs were imposed won't have to pay the duties, while many companies have built a stockpile of goods and could hold off on price hikes in hopes that tariffs will ultimately be reduced. Consumers, at least those outside the top one-fifth in incomes, are also more stretched financially than a few years ago and are more likely to resist price hikes, which could push firms to delay raising prices as long as possible. Consumer prices cooled noticeably in February and March, prompting Trump to claim repeatedly on social media that there is 'NO INFLATION.' Inflation has fallen to nearly the 2% target set by the Federal Reserve, the agency charged with fighting higher prices. Yet grocery prices have jumped in two out of the past three months, despite Trump's claims. He has also said gas has fallen to $1.98 a gallon, which is below the measured average in any state. AAA said Monday that gas costs an average $3.14 a gallon nationwide. Advertisement On Monday, the White House said it has cut the tariff it imposed on Chinese goods from 145% to 30%, while China also sharply reduced its duties on U.S. goods. Both sides could add 24% tariffs after 90 days if they don't reach a broader agreement. The smaller import taxes will limit the damage to the U.S. economy, but combined with a 10% universal tariff already in place, plus larger import taxes on autos, steel, and aluminum, economists forecast they will still slow growth this year and worsen inflation. The Yale Budget Lab, for example, estimates that the average U.S. tariff will be nearly 18% even including the deal reached Monday between the U.S. and China. At that level, U.S. duties will be the highest since 1934. The Budget Lab calculates the tariffs will lift prices 1.7% and cost the average household about $2,800. And while Trump may tout his trade deals — such as the one with the United Kingdom reached last week — he has also said 'tariffs is the most beautiful word' in the dictionary, and is counting on revenue from duties to narrow the budget deficit, suggesting tariffs will likely remain high. The tariffs have also put the Federal Reserve in an exceedingly difficult spot, as Chair Jerome Powell acknowledged in a news conference last week. Powell said the duties have raised the risk of both higher inflation and higher unemployment, two challenges that rarely occur simultaneously. If unemployment rose, the Fed would typically cut rates to boost the economy, while if inflation worsened, the central bank would usually raise rates or leave them elevated. Advertisement
