Inflation is on the rise again, contrary to claims of low price growth. Six months post his return to power, Trump's administration has instituted aggressive tariffs, contributing to increased prices across consumer goods. The consumer price index is climbing, dismissing earlier claims of a lull. Average effective tariff rates have reached 20.6%, the highest since 1910. Despite assertions that targeted countries would bear the costs, it is importers and consumers that feel the financial pinch. Jerome Powell confirmed that higher tariffs ultimately affect consumers through increased costs.
Trump has presided over the chaotic rollout of tariffs on an array of overseas products that many have argued risk having the exact opposite effect. After a lull, the consumer price index (CPI) is back on the rise.
The overall average effective tariff rate is now set to hit 20.6%, according to the non-partisan The Budget Lab at Yale, its highest level since 1910.
Tariffs are a burden. One way or another, the impact typically is felt along each link of the supply chain, from the initial manufacturer to the customer who buys the finished product.
Ultimately, the cost of the tariff has to be paid and some of it will fall on the end consumer, noted Jerome Powell, at a recent press conference.
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