The main report is expected to show on Tuesday that the inflation rate increased in July, which indicates that President Donald Trump’s tariff increases increasingly over consumers.
Trump’s reaction to the report can be – especially if heating of inflation shows – more important after the Federal Agency head was released behind the data.
Trump accused the office of work statistics, Erika Minarker, of allowing the agency to manipulate job data, which is still baseless. Last week, the shooting has caused warnings throughout Washington and most of the main economists, who say it may affect the safety of the Ministry of Labor data. While the data is routinely subject to reviews, there is no evidence that the changes were of political motives.
A BLS spokesman said that the consumer price index report, which measures the growth growth of consumers, will not be affected by the overthrow of McNTarfer. No official changes were announced on its methodology last week.
The president is particularly associated with data, amid the increasing marks of its unprecedented definition strategy that disrupts the economy. It even confirms that commercial duties The United States makes “strong and rich,“The growth of the last function in anemia was increasingly focused on a narrow range of sectors such as health care, government government and local government.
The effect on consumer prices seems to be more clear. Customs duties are taxes that the government collects on imported goods, which hundreds of billions flow to the United States every month.
There was a discussion about who already ended with the cost of import taxes, which economists agree as inflation. Goldman Sachs analysts now estimate that consumers paid about 22 % of the costs of definitions until June. In a memorandum of customers, they said this number could reach up to 67 % by the end of the year such as companies and supply chains that adapt to the new system. In this scenario, the separate inflation scale preferred by the Federal Reserve will increase to 3.2 % in December, before the official central bank’s goal is 2 %, analysts said.
Some economists now Raise the possibility The definitions stimulate the American economy towards recession, as it weakens the labor market even as prices are accelerated.
This is one of the worst scenarios of the Federal Reserve, which was commissioned by Congress while maintaining both unemployment and low inflation. Federal Reserve Chairman Jerome Powell indicated that if this is not due to Trump’s tariff, the Fed Bank has now reduced interest rates in order to make borrowing in the economy cheaper and thus helps to enhance work.
Under the current circumstances, with increased price pressures, reduction rates become more difficult.
“In the recession environment, it is dangerous to reduce without clear evidence that inflation has reached its peak.” In other words, reduce rates very soon risk increasing inflation by increasing general economic activity.
Two appointed to the Federal Reserve Council have a different point of view. In the observations that were delivered on Saturday, Michelle Bowman, Vice -President of the Federal Reserve for Supervision, said that any inflationary effect of definitions should be considered “for one time”, and that excluding these effects reveals much more price growth. Chestopoher Waller A similar view was presented earlier this month.
Waller said: “Standard Central Banking is” looking at “these effects at the price level as long as inflation expectations are established, and they are.”
This opinion is not shared by Powell, who said it is still unclear whether the inflationary effect of the customs tariff will prove that it is short -term.
“It is also possible that inflationary effects instead are more stable,” He said in the Congress certificate in June. “Avoiding this result will depend on the size of the effects of customs tariffs, and for the time it takes until they go entirely to prices, and in the end, to maintain the long -term inflation expectations.”
Some economists estimate that it may require As long as 18 months The effect of customs tariffs is completely on their way through the economy.
“The bulk of the effects are still in front of us,” Diane Swank, the chief economist of the KMPG consulting company, He said today’s “Today” offer.
Beyond the customs tariff, consumers still feel a high -price pension on a variety of fronts, which is the president’s promise to address the campaign path last year. Cow meat prices ground meat Now at the highest level ever like Drought has destroyed the herd. Electricity prices also Now in recordsWhile insurance costs for the owner of the homes It also started in reaction. While the modified weekly profits of inflation It was placed in the last quarterNearly 43 % of the workers have seen their salaries grow less than the cost of living as of June, according to what follows, with more focused on the low -wage spectrum, According to reality.
A separate scale for the current and future family financial cases followed by the Conference and Consulting Council Research Group It deteriorated in JulyWith the share of consumers who expect stagnation over the next 12 months, it is still higher than the levels seen in 2024.
Last month, CNBC Follow -up price movements Of 50 elements in Walmart, some have increased by up to 50 %. “Pricing fluctuations are a normal course of business and are affected by a variety of factors,” said Wall Mart.
Earlier this year, Walmart CEO was more directly about the tariff.
“We are wireless for low daily prices, but the size of these increases is more than any retailer can absorb it,” Financial Director John David Riny Tell CNBC in May.