Fri, 04 Jul 2025

Fri, 04 Jul 2025 What have tariffs really done to the US economy?

As President Trump weighs tariff plans, he will have one eye on the US economy.
Tariffs' impact on economy
* US stock market suffered immediate hit in February, dropping 12% over a week
* Shares rebounded after Trump rolled back plans, abandoning steep tariffs for 10% rate
* S&P 500 index up about 6% for year, but shares of tariff-vulnerable firms still hurting Trade and imports
* US goods imports up 17% in first five months of year compared to same period last year
* Rush of goods to US early this year followed by sharp drop in April and May
* Firms may opt to pass on tariff increases gradually rather than alienate customers Economic growth and inflation
* Economic sentiment in US started falling earlier this year, with worries about tariffs leading households to clamp down on spending
* Retail sales dropped 0.9% from April to May, second month in a row of decline
* Consumer spending grew at slowest rate since 2020 in first three months of year Job market and recession risk
* Unemployment remains low at 4.2%, but job creation has slowed
* Layoff notices have increased, and analysts warn of possible recession if tariffs are reimposed
* Economists say economy unlikely to escape unscathed, with possibility of softening or bigger slide
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