There are no signs yet of tariff-induced inflation, and the data continue to reflect the slow disinflationary process that was already in place before the tariffs were introduced.
Thanks for your comment—you raise a very important point. First, there’s the implicit issue of timing: the lag between the implementation of tariffs and their impact on prices. If businesses are still working through pre-tariff inventories, the immediate pass-through to consumer prices could indeed be delayed.
That said, there are still factors that may lead to earlier price effects. Even if current inventories were sourced before tariffs, some firms may raise prices preemptively in anticipation of higher replacement costs, especially if competitors do the same. Additionally, pricing strategies may adjust based on expectations that tariffs will eventually be enforced, even if currently postponed.
Second, if I understand your question correctly, you're suggesting that inventories might still be in place when negotiations conclude. If that's the case—and if the outcome involves only limited tariffs—then the overall impact on inflation could be minimal. That’s certainly a plausible scenario.
We'll know more after July 9th, once we see which trade agreements are reached and the specific terms involved.
Let’s assume that businesses are still working on their pre-tariffs inventory, is it too much optimism to say these inventories will still be in place right after tariffs negotiations have concluded? Given that tariffs implementation was postponed?
What tariffs inflation are some expecting? I’m I missing something?
Thanks for your comment—you raise a very important point. First, there’s the implicit issue of timing: the lag between the implementation of tariffs and their impact on prices. If businesses are still working through pre-tariff inventories, the immediate pass-through to consumer prices could indeed be delayed.
That said, there are still factors that may lead to earlier price effects. Even if current inventories were sourced before tariffs, some firms may raise prices preemptively in anticipation of higher replacement costs, especially if competitors do the same. Additionally, pricing strategies may adjust based on expectations that tariffs will eventually be enforced, even if currently postponed.
Second, if I understand your question correctly, you're suggesting that inventories might still be in place when negotiations conclude. If that's the case—and if the outcome involves only limited tariffs—then the overall impact on inflation could be minimal. That’s certainly a plausible scenario.
We'll know more after July 9th, once we see which trade agreements are reached and the specific terms involved.
Let’s assume that businesses are still working on their pre-tariffs inventory, is it too much optimism to say these inventories will still be in place right after tariffs negotiations have concluded? Given that tariffs implementation was postponed?
What tariffs inflation are some expecting? I’m I missing something?