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Will Trump’s Tariffs Cause Inflation?

The U.S. government is poised to shake up global trade in April 2025. Tariff rate increases are scheduled to go into effect on imported goods from Canada, Mexico and China. In the early months of his 2nd term, President Trump has proposed several other tariff rate increases targeting specific industries like automakers and pharmaceutical companies. Some economists argue these new trade policies will be inflationary. Others say foreign countries will pay for them. Research from the Federal Reserve, shows that consumer prices may rise if businesses pass the increasing tax burden onto their consumers. But the central bank’s leaders are considering the full effects of the administration’s trade, immigration, regulatory and fiscal policies before adjusting monetary policy. Watch the video to find out if the new tariffs will be inflationary and what, if anything, the Federal Reserve will do about it. Chapters: 0:00 Cold open 1:17 Markups 4:07 Imported products 6:11 Transitory inflation Produced and Edited by: Carlos Waters Additional Camera by: Jordan Smith Animation: Jason Reginato Senior Director of Video: Lindsey Jacobson Additional Footage: Getty Images Additional Sources: Allianz, Bolton Partners, Fidelity, Grant Thornton, Federal Reserve Bank of Boston, Federal Reserve Bank of Minneapolis, Morningstar, Peterson Institute for International Economics
Tue, 01 Apr 2025 16:00:02 GMT

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