A study from President Donald Trump’s Council of Economic Advisers (CEA) finds that the price of imported goods has fallen this year, allegedly contradicting fears that tariffs will lead to an acceleration of inflation. However, the CEA study raises more questions than it answers:
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Regarding the impact of tariffs on prices, the timeframe used by the CEA is way too short to draw any definitive conclusions. The CEA study runs through May 2025. Trump’s 10% nonreciprocal tariffs were only imposed in April.
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It is not surprising that new tariffs imposed on China earlier in the year would have a limited impact on overall prices. U.S. companies scrambled to import as many goods as possible to stockpile before new tariffs were fully implemented, mitigating the immediate impact of tariffs on prices.
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Imports from China account for just 13.2% of total…
