Despite dire warnings from the economic elite, the Trump administration’s bold tariff moves in 2025 haven’t sent prices through the roof just yet.
Contrary to the hand-wringing of many economists, the sweeping tariffs imposed on dozens of U.S. trade partners this year have left the cost of goods and services surprisingly steady, though whispers of future price hikes linger on the horizon, CBS News reported.
Back on April 2, 2025, President Trump announced these new tariffs, setting the stage for a protectionist push aimed at shielding American jobs and boosting global competitiveness.
The White House has been adamant that foreign exporters, not American consumers, will foot the bill for these added costs at the border.
“The Administration has consistently maintained that the cost of tariffs will be paid by foreign exporters who rely on access to the American economy,” said spokesman Kush Desai. Well, that’s a nice theory, but let’s see if the world’s exporters play along or if they sneak those costs right back to us through higher prices down the line.
Interestingly, the average tariff rate on U.S. imports by June 2025 was just 9%, a far cry from the 15% some number-crunchers predicted, according to Capital Economics.
This lower rate stems from a clever reshuffling—countries hit with steeper tariffs are shipping less, while those with lighter rates are sending more, balancing the scales.
Barclays data also shows that of the $258 billion in imports hitting U.S. retail markets in June, only 48% faced tariffs, with exemptions for goods like pharmaceuticals and imports from Canada and Mexico softening the blow.
“While dutiable goods face elevated tariff rates, a substantial portion of U.S. imports remains duty-free,” noted Barclays analysts in a recent report. Duty-free is music to a shopper’s ears, but it’s a temporary shield if those exemptions don’t hold.
Speaking of shields, U.S. retailers stockpiled goods early in 2025, anticipating tariff hikes, and are still selling off non-tariffed inventory, delaying any sticker shock for consumers.
Retailers are also eating some of the added costs themselves, taking a hit to profit margins rather than passing it on—though analysts warn this won’t last forever.
“Businesses have been willing to absorb the initial hit via lower margins,” Capital Economics analysts observed, adding, “We doubt that is a sustainable outcome over the longer term.” Smart move for now, but when the clarity on tariff rates settles, expect those price tags to creep upward.
Economists point out that tariffs often take a long time to ripple through the economy, as companies hesitate to raise prices and risk losing market share.
A Federal Reserve Bank of Dallas report from June 2025 confirms the full impact on consumer prices usually peaks about a year after tariffs kick in, meaning we might not feel the pinch until late 2025 or even 2026.
So, while there’s been a modest uptick in costs for clothing, home furnishings, and appliances, the severe inflationary spiral many feared hasn’t materialized—yet. The White House touts this as proof that their strategy works, but patience is key; the jury’s still out on whether this calm is just the eye of the storm.
