President Donald Trump speaks about new tariff plans at the White House in Washington, April 2, 2025.
Brendan Smialowski AFP | Getty Images
Without President Donald Trump’s tariffs, prices for many everyday items would have fallen between last year and early this year, according to the New York Fed.
According to a paper by a team of researchers at the central bank’s New York branch, the price of 67 products rose by 2.9 percentage points as of February as a result of the tariffs.
Without the surcharge, the researchers found that the prices of the products they studied would have been almost 1% lower.
A New York Fed report provides the clearest evidence yet about the impact on consumers’ wallets of President Trump’s tariffs, a core policy of his re-election campaign and second term in the White House. Economists widely expected his levy to push up prices, but the changing nature of the policy and opacity in how companies set prices made it difficult to estimate the exact effect.
The researchers did not say which of the 67 products they evaluated.
The researchers said that for every 1 percentage point increase in average prices, consumer goods prices rose by about a quarter of a percentage point a year later.
Annual price increases for dozens of products studied peaked in early 2026, according to the report. However, as a result of this policy, consumers are still expected to pay higher prices until 2027, the report said.
According to a New York Fed report, about two-thirds of the price impact associated with tariffs comes directly from the levy itself. The rest of the increase came from spillovers, such as U.S.-based companies using imported parts and materials in their products.
“Tariffs have a larger and longer-lasting impact on consumer prices than their direct impact alone would suggest,” study authors Mary Amity, Sebastian Heise, and David Weinstein wrote.
President Trump has argued that businesses can absorb the increased costs of tariffs rather than passing them on to shoppers in the form of price increases. The New York Fed team said about 26% of last year’s tariff hikes ended up trickling down to higher prices.
In February, the Supreme Court reversed many of President Trump’s tariffs, resulting in billions of dollars in refunds to retailers. The White House has vowed to pursue the tax through alternative measures, which currently often impose a tax of about 10% on products imported from many countries. In many cases, this is significantly lower than the amount based on the initial tariff.
