Tag: inflation

Trumponomics Already Taking Toll on U.S. Economy

Buck Banks

From the New York Times:

“The United States economy is starting to show signs of strain as President Trump’s abrupt moves to shrink federal spending, lay off government workers and impose tariffs on America’s largest trading partners rattle businesses and reverberate across states and cities.”

“Funding freezes and firings of federal workers combined with the prospect of costly trade wars are souring consumer sentiment, raising inflation expectations and stalling business investment plans, according to recent economic surveys.”

“Local economies are also bracing for a sudden withdrawal of fiscal support, forcing officials to contemplate tax increases or municipal bond offerings to stabilize their budgets. While Mr. Trump has acknowledged that his policies could bring some initial pain, the early warning signs suggest that his blunt approach could come with more ominous risks to the economy.”

Trumponomics: Inflation Is Rising

Buck Banks

3%

U.S. inflation rose to 3% in January, strengthening the case for the Federal Reserve to extend a pause on interest rate cuts, reported the New York Times. The Consumer Price Index jumped more than expected, data from the Bureau of Labor Statistics showed on Wednesday, rising 0.5% from December in what was the fastest monthly increase since August 2023. Last month, the annual pace was 2.9%. “Core” C.P.I., which more closely reflects underlying inflation by removing volatile food and energy prices, also showed little improvement. It rose 0.4% from December or 3.3% on a year-over-year basis, both higher than economists expected. The monthly increase in core prices was the highest since April 2023.

Trump’s Tariffs to Tack $3k on to Price of New Cars

Buck Banks

$3,000

Bloomberg: The duties would immediately hit almost one-quarter of the 16 million vehicles that are sold in the US each year, as well as the parts and components that go into them — an import market that totaled $225 billion in 2024, according to research from consultant AlixPartners. Tariffs will add $60 billion in costs to the industry, the research shows, much of which is likely to be passed on to consumers.

Plurality of Economists Say Inflation Would Be Worse Under Trump

Buck Banks

56%

“The Wall Street Journal’s survey, conducted July 5-9, received responses from 68 professional forecasters from business, Wall Street and academia. Of the 50 who answered questions about Trump and Biden, 56% said inflation would be higher under another Trump term than a Biden term, versus 16% who said the opposite. The remainder saw no material difference.”

Consumer Price Index Falling Slowly Over three Months

Buck Banks

3.6%

New York Times: The Consumer Price Index climbed 3.4 percent in April, down from 3.5 percent in March, the Labor Department said Wednesday. The “core” index — which strips out volatile food and fuel prices in order to give a sense of the underlying trend — rose 3.6 percent last month, down from 3.8 percent a month earlier. It was the lowest annual increase in core inflation since early 2021.