The US is likely to see higher prices for goods despite President Trump’s efforts to forge new trade deals, experts say. The new normal for US tariffs on foreign goods starts at 15%, and companies are warning that this will lead to higher operational costs and increased prices for consumers.
Nestle, Moncler, and General Electric are just a few examples of companies that are already feeling the effects of proposed US tariffs. Nestle is considering price hikes for its candy bars, while Moncler has already raised prices for its apparel. General Electric estimates that it will lose $500 million in 2025 due to proposed US tariffs.
The White House disputes this, saying that the cost of tariffs will be borne by foreign exporters who rely on access to the American economy. However, economists warn that consumers should brace for higher prices on a range of goods later this year.
Paul Ashworth, chief North America economist at Capital Economics, says that “up to now there has been only limited passthrough from tariffs into final consumer prices.” However, he expects the impact to gradually mount in the second half of the year. The Yale Budget Lab projects that higher US tariffs will drive up prices by 2% over the next two years.
Some product categories are more sensitive to tariffs than others. Foreign-made leather shoes and handbags, along with apparel, could see price increases of at least 40%. Electronics could also see sharp price hikes, jumping more than 20%, according to the Yale Budget Lab.
Source: https://www.cbsnews.com/news/tariff-baseline-15-percent-nestle-consumer-prices