Tariff debate shifts focus
The Minneapolis Fed says tariffs are not the primary driver of recent goods inflation, arguing input costs may be the bigger factor. (rfdtv.com). Concurrent commentary is pushing for clearer rules on how importers should handle tariff refunds, highlighting administrative and accounting uncertainty as tariff policies are unwound. (washingtonexaminer.com)
A new Minneapolis Fed analysis says recent goods inflation does not line up with tariff exposure, even as U.S. Customs rolls out a new system for tariff refunds. (minneapolisfed.org) (cbp.gov) The Minneapolis Fed paper, published April 8, looked at detailed personal consumption expenditures data and found categories with the biggest predicted tariff hit were not the ones with the biggest price increases. It said core PCE inflation was 3.1% year over year through January 2026, with core goods inflation at 1.9%, versus a 2015-19 average of negative 0.6%. (minneapolisfed.org) The authors said excess core goods inflation was adding 0.6 percentage points to core PCE, but argued tariffs alone could not explain that pattern. Their conclusion was narrower than “tariffs do nothing”: they said tariffs have raised some prices, while “other factors” must be pushing up some goods prices or limiting pass-through in other categories. (minneapolisfed.org) That view lands against other Federal Reserve research published the same day. A Board of Governors note said tariffs implemented through November 2025 had raised core goods PCE prices 3.1% through February 2026 and explained all excess inflation in core goods relative to pre-pandemic rates, with a 0.8% boost to core PCE overall. (federalreserve.gov) The difference is partly about method. The Board note estimated tariff pass-through over time across goods categories, while the Minneapolis Fed tested whether the cross-category pattern of inflation matched where tariffs should have bitten hardest. (federalreserve.gov) (minneapolisfed.org) At the same time, the policy fight has moved from prices to paperwork. U.S. Customs and Border Protection says Phase 1 of its CAPE refund process for duties collected under the International Emergency Economic Powers Act will launch April 20, 2026, and it will start with certain unliquidated entries and some entries within 80 days of liquidation. (cbp.gov) CBP said importers or their brokers must file refund requests through the Automated Commercial Environment portal using a CSV upload, not the older Automated Broker Interface. Each declaration can cover up to 9,999 entries, and CBP said the process is being built in phases for more complicated cases later. (cbp.gov) Getting paid back now also requires the right bank setup. CBP said on January 2, 2026, it moved refunds to Automated Clearing House payments, and companies are being told to set up or verify ACE portal access and ACH refund authorization before money is issued. (cbp.gov) That leaves importers with two separate questions: how much tariffs actually lifted consumer prices, and how quickly businesses can unwind duties already collected. The economic answer is still being debated inside the Federal Reserve, while the administrative answer now depends on whether importers can navigate CBP’s phased refund system. (minneapolisfed.org) (federalreserve.gov) (cbp.gov)
