Inflation – Economists at the bank said ‘overwhelming evidence’ showed Trump’s tariffs fueled US inflation revealing consumers in the U.S. paid 50% to 70% of the cost of U.S. President Donald Trump’s tariffs and may continue to do so.

A new report from leading bank economists has reignited debate over the true cost of former President Donald Trump’s trade war, revealing that American consumers bore the brunt of his tariffs on imported goods — paying between 50% and 70% of the total costs.

The Tariff Fallout

When the Trump administration imposed sweeping tariffs on goods from China and other countries, the stated goal was to protect U.S. manufacturers and force trading partners to “play fair.” However, economists now say the data tells a very different story: rather than foreign exporters absorbing the tariffs, American households and businesses ended up footing most of the bill.

The analysis found that importers passed much of the additional cost directly to consumers through higher prices on everyday goods, from electronics and clothing to furniture and household items.

“What was designed as an attack on foreign producers ended up acting as a hidden tax on American families,” the report noted.

How Tariffs Hit Ordinary Americans

The report shows that the average U.S. household paid hundreds of dollars more annually due to higher prices caused by tariffs. For many middle-income families, this increase came at a time when inflation and wage stagnation were already squeezing budgets.

Economists also pointed out that the impact was disproportionately felt by lower-income consumers, who spend a larger share of their income on goods affected by tariffs.

In sectors like manufacturing, the policy had mixed outcomes. While some U.S. producers benefited from reduced foreign competition, others suffered from higher costs for imported parts and materials.

Tariffs Still Costing the Economy

Despite promises that tariffs would boost domestic production and bring back American jobs, the data shows that long-term benefits have been limited.
Manufacturers have continued to face higher input costs, and many companies shifted supply chains rather than increasing U.S. hiring.

“Tariffs are effectively a tax,” one economist said. “They distort markets and reduce overall economic efficiency. Consumers pay more, and businesses face uncertainty.”

What’s Next?

With the 2024 presidential campaign still fresh in public memory, Trump’s tariff policy is once again under scrutiny as he hints at new trade measures if he returns to power. Some of his advisers have floated the idea of a “universal baseline tariff” on all imports, which economists warn could further inflate prices and destabilize global trade.

Analysts predict that if similar tariffs are reinstated, Americans could face even higher consumer costs and slower economic growth.

Final Thoughts

The new findings reinforce what many critics of Trump’s trade policy long argued — that tariffs rarely punish foreign nations as intended, but rather land hardest on domestic consumers and small businesses.

As the debate over protectionism versus free trade continues, one thing remains clear: American households have already paid a steep price for the trade wars of the past — and may continue to do so in the future.