By Robin Bruno
With more tariffs being implemented by the government, for the purpose of gaining more revenue for the government or to obtain a leg up on other countries. It is negatively affecting consumer purchasing power by increasing the prices of most imported goods.
An increase in price for these imported goods means that suppliers are inclined to look elsewhere for materials that are cheaper to obtain. This causes damage to businesses that manufacture, are in retail, and create technology, which all rely on imported goods to make their products.
Many economists are beginning to predict a bigger increase in prices because of these tariffs. This is likely to have a negative impact for everyday consumers because they will be paying way more for products, especially ones that you rely on.
With the government administering many new tariffs, it is possible that they will lead to inflation. The University of Michigan predicts a “one-year-ahead expected inflation rate jumped to 6.5% in April 2025,” a nice and stable inflation rate would be around 2%.
Morgan Stanely economists state that they will, “Continue to expect a significant slowdown in consumption in the back half of the year as price increases from tariffs weigh on purchasing power,” in response to the decrease of consumer spending on health and sporting goods.
Increased tariffs also means shopping prices are going to increase as well, and with events like Black Friday, shoppers were more reluctant when it came to spending, many stuck to budgets and watched their spending.
Economists say that with consumers contributing to, “About two-thirds of economic activity,” Black Friday is one of the biggest contributors when it comes to affecting the market.
Since so many people take part in Holiday shopping, there are often multiple significant purchases made which raises consumer spending confidence and helps indicate to businesses that people are willing to spend on a product.
A financial website used by economists called Adobe, estimates that there will be a “total of $253.4 billion in holiday spending this year, up from $241.1 billion in 2024.” This can contribute to inflation and make sales grow even more.
Another thing that tariffs affect is the demand of certain products, with new tariffs being put into action, the effects can be unpredictable. This uncertainty makes businesses halt on releasing any new products, which ultimately makes economic growth slow down.
Tariffs affect many different aspects of the economy, and can have many negative effects on businesses and consumers. We as a community can deal with this by limiting our shopping habits, adjusting our budgets, and making sure to save as much as we can.
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