2. March PCE was 0.8 pp higher, and would have been 2.3% without tariffs.
3. Inflation from tariffs peaked in February 2026.
4. Likely to not be much more inflation from tariffs; if PCE remains high, it’s from tariff spillovers or other external factors (hello Iran).
Some snippets:
“We estimate that tariff collections increased March 2026, 12-month core PCE inflation by about 0.80 percentage points and that core inflation absent tariff effects on relative prices would be 2.3 percent.”
“Estimated tariff impacts on 12-month core PCE inflation peaked in February 2026 at a level consistent with full pass-through of tariff collection-driven cost increases to consumer prices.”
“Our results suggest that additional strengthening of 12-month core goods inflation rates would likely be inconsistent with direct impacts of 2025 tariff rate changes alone but rather reflect tariff-driven spillovers or other factors keeping core goods inflation elevated”
Icedidit on
If conservatives could read they’d just blame this on trans kids playing c team sportsball, Muslims living in western countries, and illegals getting free houses, phones, and healthcare.
Non of which is true or matters but that’s why our economy is experiencing this tariff inflation.
2 Comments
A link to the actual paper. Because the figures have replication data.
https://www.dallasfed.org/research/economics/2026/0505-mau
A TL; DR:
1. Consumers pay all the tariffs.
2. March PCE was 0.8 pp higher, and would have been 2.3% without tariffs.
3. Inflation from tariffs peaked in February 2026.
4. Likely to not be much more inflation from tariffs; if PCE remains high, it’s from tariff spillovers or other external factors (hello Iran).
Some snippets:
“We estimate that tariff collections increased March 2026, 12-month core PCE inflation by about 0.80 percentage points and that core inflation absent tariff effects on relative prices would be 2.3 percent.”
“Estimated tariff impacts on 12-month core PCE inflation peaked in February 2026 at a level consistent with full pass-through of tariff collection-driven cost increases to consumer prices.”
“Our results suggest that additional strengthening of 12-month core goods inflation rates would likely be inconsistent with direct impacts of 2025 tariff rate changes alone but rather reflect tariff-driven spillovers or other factors keeping core goods inflation elevated”
If conservatives could read they’d just blame this on trans kids playing c team sportsball, Muslims living in western countries, and illegals getting free houses, phones, and healthcare.
Non of which is true or matters but that’s why our economy is experiencing this tariff inflation.