UBS On-Air: Market Moves UBS On-Air: Paul Donovan Daily Audio 'Data’s phony trade war'
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May 14, 2025 Inflation trends in the US show surprising resilience against trade tensions, with little impact from tariffs. Tourism prices are cooling, likely due to visitor hesitance, while appliance price inflation is spiking. The discussion dives into how these factors intertwine with geopolitical issues and the need for clarity in trade data. Understanding these dynamics is crucial for making savvy investment decisions amid a turbulent market.
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Limited Tariff Impact on Inflation
- US consumer price inflation data shows little clear impact from tariffs so far.
- Tourism prices fell possibly due to visitors' wariness and timing of Easter affecting comparisons.
Appliance Price Inflation Concerns
- Appliance prices rose at the fastest monthly rate since early 2022.
- This may reflect firms anticipating higher trade taxes affecting vulnerable sectors.
Tariffs and Producer Prices Link
- Upcoming US producer price inflation data will reveal if tariffs are driving manufacturers' price hikes.
- This could translate into higher consumer price inflation if tariffs are used as a pricing mechanism.