(June 2025) U.S. inflation rises 0.1% in May from prior month, less than expected

I can’t believe you clicked on that…
Ewww

 

Your question is about my emotions. Seriously.

Since my emotions are your concerns, I'd be thrilled to talk about the effects of tariffs on demand and their complex relationships with prices. You want to talk about my emotions. So nice try to turn your obsession around.

Prices go down from increasing supply or decreasing demand. As of now, the data is showing decreasing demand, not increasing supply. We are seeing relatively slow increases in price during a time of falling demand. If the data changes, then we will see what happens.

 

But, but, but wait a minute, inflation is just around the corner. (chuckle)

 

Go ahead and laugh. Most experts didn't predict the tariffs to take full effect until June/July. And today's report looks only through May. As this article puts it:

Trump's tariffs may have contributed to the rising price of some goods in May, such as appliances and toys. But overall goods prices held steady last month. Forecasters expect the cost of tariffs to become more evident in the months to come.
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Of course, the inflation may never come to full fruition. But that's because we may already be in a recession and prices aren't spiking because demand is falling. And as stated before, an increase in supply or a drop in demand will cause prices to drop. While overall, we have yet to see any dramatic shift in spending, the sentiment out there is it too is just starting. Here's a good report from McKinsey if you are interested in consumer spending sentiment.

Of course, if TACO Trump continues to chicken out, then who knows what the future holds. Trump went from 160% tariffs on China to start and just agreed, in principle, to 10%.