UBS On-Air: Market Moves UBS On-Air: Paul Donovan Daily Audio 'And so it begins? '
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Jul 15, 2025 The podcast delves into the latest US consumer price inflation data and its connection to recent trade tax impacts. It highlights how only a portion of expected tax effects have been felt in the economy so far. Inventory stockpiling adds another layer, as pre-tax items are still circulating. The discussion shifts to how US firms manage to pass on these price increases, especially in a post-pandemic landscape. Additionally, it addresses the influence of tariffs in media narratives surrounding inflation.
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Partial Trade Tax Impact Now
- Only half of the full trade tax impact is currently affecting the US economy.
- Inventory stockpiling and available pre-tax goods delay the price increases from tariffs.
Easier Price Pass-Through Today
- Passing on price increases is easier now due to post-pandemic inflation conditions.
- Media focus on tariffs reinforces consumer acceptance of price rises.
EU Tariffs Designed Thoughtfully
- The EU retaliation list targets goods that minimize impact on its own consumers.
- EU plans unspecified tariffs possibly to promote US lobbying against them.