Main summary
The new tariff package of President Donald Trump will probably result in higher prices for US consumers, according to a new analysis of Yale University published on Wednesday. It is projected that the president’s tariff policy could cost US households. 2,400 additional dollars this year if they enter into force and the new tariffs on copper and products from foreign countries are maintained.
Key points
Yale’s budget laboratory published an updated analysis that projects the impact of Trump’s tariff policy, taking into account all tariff ads until Wednesday, including new tariffs for countries such as Brazil, Japan and South Korea, and the 50% tariff planned about copper imports.
The general combination of the various Trump tariffs would be equivalent to an effective tariff rate of 18% for US consumers – if the announced tariffs are implemented and maintained -, which, according to the analysis, would be the highest rate since 1934.
Trump tariffs could cause a 1.8% increase in short -term prices for US consumers, which is equivalent to the average home in the US.
Lee: Central Bank of the US confirms price increase for tariffs
This figure does not take into account possible actions that the Federal Reserve could take in response to tariffs, such as a reduction in interest rates, which could also affect households.
Tariffs could also cause a 0.4% increase in the unemployment rate this year and a 0.7% drop in the US GDP. Maintaining tariffs in force could maintain GDP consistently 0.4% lower than would otherwise, which would imply an approximate loss of 110 billion dollars per year, according to the study.
Although tariffs are expected to negatively affect sectors such as construction and agriculture, the analysis projects that will boost US manufacturing by 2%.
Soser context: Tariffs will affect economies from North America: Builders
Outstanding figure
2.2 billion dollars. That is the amount of income that is expected to generate Trump tariffs between 2026 and 2035 if the tariffs already announced remain in force, according to Yale’s analysis. This projection is based on a total of 2.6 billion dollars, compensated for 418 billion dollars in negative impacts.
What is not known: how will Trump’s tariffs change
Trump continues to send letters to foreign countries imposing new tariff rates and has raised the possibility of imposing more tariffs on specific sectors such as the pharmacist. The president’s tariff policy has frequently changed – what has earned him the nickname of “Taco Trump”, for “Trump Always Chickens out” (Trump is always thrown back) -, so it is difficult to predict how it will evolve in the coming months. The new tariff package is scheduled to enter into force on August 1, but even countries that have already received new rates have said they will continue to negotiate with the White House to try to reduce them. The letters also indicate that the US could increase or reduce rates according to “our relationship with your country.”
Soser context: Trump says that the deadline for tariff negotiations is not firm after all
What products will be most affected by Trump’s tariffs?
It is expected that clothes, textiles and footwear are the products with the highest price increases due to tariffs, according to Yale’s analysis. Clothing and footwear prices could rise 37% and 39% in the short term, respectively, and stabilize with a long -term rise. Metal prices, leather items and electrical equipment are also expected to increase 43%, 39% and 26% in the short term. The prices of vehicles, electronic and rubber and plastic products could rise between 11% and 18%. Minor increases in food are anticipated, although the prices of vegetables, fruits and nuts could increase up to 6%. Experts have speculated that 50% tariffs on Brazilian imports could specifically affect popular products such as coffee and orange juice.
Additional data
A separate survey conducted by KPMG to businessmen also found that prices will probably increase as a result of Trump tariffs. Among the 300 business leaders and senior executives surveyed, 83% said they hope to raise their prices in the next six months. More than half already reported narrower margins due to tariffs. “The total impact on consumers is probably yet to come,” said Brian Higgins, an advisor in industrial manufacturing of KPMG EE. UU., In a statement on Wednesday.
Key context
Trump has converted tariffs on the central axis of its economic policy, applying them generalized to almost all countries, despite long -standing concerns among economists about this could raise prices for consumers and cause possible recession. In April, the president temporarily suspended the worst tariffs of the “day of liberation” after a fall in the markets after the initial announcement, but has continued to defend his policy. The White House has indicated recent inflation and analysis data that suggests that tariffs have not caused important price increases so far. This week, the tariffs were again in the center of the debate, since the 90 -day initial pause for the highest rates of the “Liberation Day” was about to expire, although Trump decided to extend the deadline until August 1 and at the same time sent letters imposing new rates to several countries. These letters arose after the plan of their administration to negotiate complete trade agreements during the 90 -day break failed mostly, with only three important agreements concreted with the United Kingdom, China and Vietnam.
This article was originally published in Forbes United States
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