Marketplace Morning Report Why we might not see tariffs in overall inflation numbers
Jul 14, 2025
Inflation is in the spotlight as tariffs remain a hidden factor in economic dynamics. While the Federal Reserve's policies keep overall inflation numbers stable, specific goods are feeling the pinch of higher prices. The EU is navigating trade tensions with the U.S., delaying retaliatory measures to avert escalation. Meanwhile, traders are scrambling to reroute copper imports ahead of impending tariffs, impacting the technology and construction sectors. This complex web of trade and policy reveals the intricate dance of global commerce.
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EU Delays Tariffs Amid Tensions
- The European Union delayed retaliatory tariffs to try and negotiate a trade deal with the U.S.
- EU members are divided, but potential tariffs target U.S. exports like agricultural goods, steel, aluminum, clothing, and shoes.
Tariffs Affect Growth, Not Inflation
- Tariffs have raised goods prices but haven't pushed overall inflation higher due to the Federal Reserve's tight monetary policy.
- The Fed's actions cause slower income growth and force consumers to cut spending on services to offset tariff price increases.
Copper Tariffs Disrupt Supply Chains
- Anticipated 50% tariffs on copper imports are causing shipments to be rerouted to countries like China to avoid tariffs.
- This diversion could create global supply chain backlogs, leading to higher prices affecting many industries.