US consumers to bear brunt of Trump's tariffs: Goldman Sachs
Goldman Sachs says American shoppers are about to take on most of the costs from Trump's tariffs.
Until now, businesses covered nearly two-thirds of these fees, but that's flipping—soon consumers could be paying up to 67% as companies pass along higher prices.
Inflation impact
Foreign exporters might pick up a bit more of the tab (up to 25%), but with businesses' share dropping below 10%, everyday prices are set to rise even faster.
This shift is expected to push inflation higher, with the Fed's preferred inflation rate likely hitting 3.2% by year-end.
Fed might cut rates soon
Even companies not directly hit by tariffs have raised their own prices just because they can—adding more pressure on wallets.
The Federal Reserve has kept interest rates steady so far, but markets expect a rate cut soon as everyone waits to see how this plays out for consumers.