Behind the Money A case of Schrödinger’s tariffs
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Jul 9, 2025 
Claire Jones, the US economics editor for the Financial Times, unpacks the surprising resilience of the American economy amidst ongoing trade tensions. She discusses the implications of paused tariffs and the evolving dynamics of U.S. relations with China and Vietnam. The concept of 'Schrödinger's tariffs' highlights the delayed effects on markets, consumer prices, and inflation. Jones also warns of a cycle where rising tariffs could lead to self-fulfilling inflation, emphasizing the broader economic implications of these trade policies.
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Tariffs Haven't Hurt US Yet
- Despite aggressive tariffs starting April 2nd, the expected economic and inflation disasters have not happened in the US yet.
- The US economy remains strong and inflation lower than feared, confusing economists.
Tariff Pause and Stockpiling Delay Impact
- Trump's approach included tariff pauses and trade deals which softened the blow on the US economy.
- Companies also stockpiled imports ahead of tariffs, delaying the impact on consumers.
Economic Impact Still Unfolding
- The full economic effects of tariffs are still uncertain and likely to emerge in coming months.
- Firms hesitate to raise prices immediately, waiting to see competitors' moves amid uncertainty.