US Tariffs Hitting Consumers Hard: Report
U.S. average tariff rates have jumped from 3% to 12% in the last year, with 90% of costs passed on to households and businesses YouTube.
The increased tariffs are impacting consumer behavior, with some Americans engaging in "doom spending" due to fears of imminent price hikes. Approximately one in five Americans have admitted to increasing their purchases because of these fears. Small businesses are particularly vulnerable, lacking the resources to absorb rising costs and navigate disrupted supply chains. This can lead to uncertainty, cancellations, and overall economic harm. Some analysts predicted that consumers would bear the brunt, absorbing over half of the tariff costs. One analysis suggested consumers could be paying 70% of the cost by the end of the year. The Supreme Court struck down some tariffs imposed under the International Emergency Economic Powers Act (IEEPA). This may lead to the U.S. government owing businesses as much as $168 billion in refunds. Despite the increase in tariff rates, inflation has not risen as economists initially predicted. In December, the Consumer Price Index rose at an annual rate of 2.7%, which was unchanged from the previous month.
