Oct. 8 (UPI) — Tariffs have driven the prices for both imported and domestic consumer goods up by about 2.9 percentage points through February, a new study by the Federal Reserve Bank of New York said Thursday.
The study has tied inflation directly to President Donald Trump’s tariffs weeks before the midterm elections on Nov. 3. It found that the broad tariff policy has been disruptive to prices with about a quarter of price increases being passed on to consumers.
Consumer prices cooled in August, months after the U.S. Supreme Court found many of Trump’s tariffs unlawful. The high court came to a 6-3 ruling that Trump went beyond his authority to impose tariffs during peacetime on Feb. 20.
Trump launched military strikes on Iran on Feb. 28.
The 2.9 percentage point impact tariffs have had on inflation is based on a sample of 67 categories of consumer goods. If the tariffs imposed last year and this year were not in place, researchers say those prices would have been about 1% lower.
The study did not clarify which 67 categories were included in its sample.
While the effects of the tariffs have eased since many were overturned, the New York Fed expects prices to remain elevated because of tariffs into next year.
“Tariffs have a larger and more drawn-out impact on consumer prices than the direct effect alone would suggest,” wrote Mary Amiti, Sebastian Heise and David Weinstein, the authors of the study.
Despite tariffs being placed on imports, the researchers wrote that goods made in the United States “account for about a third” of the inflationary effects. Those effects just take longer to reflect in domestic goods.
“So the full effect of a tariff takes about a year to appear,” the study reads.