Tariffs likely to drive up U.S. prices even with Trump trade deals, experts say

The United States is entering a new era of trade relations with foreign countries as President Trump implements a new tariff policy. The starting point for tariffs on foreign goods will be set at 15%, with the potential to go as high as 50% depending on the country’s willingness to open up its economy to the U.S.

In a speech at an AI summit, President Trump made it clear that the U.S. is looking to renegotiate trade deals with countries like Japan and the European Union. The White House has set a deadline of August 1 for new trade agreements to be reached, with China facing a separate deadline of August 12.

These changes in trade policy are already having an impact on businesses across various industries. Companies like Nestlé, Moncler, and General Electric are considering price hikes on their products to offset the increased costs brought on by tariffs. Orange juice importer Johanna Foods has even taken legal action against the proposed 50% tariff on Brazil, citing the detrimental effect it would have on their business.

The White House maintains that the cost of tariffs will be borne by foreign exporters, not American consumers. However, economists warn that consumers should expect to see higher prices on a range of goods in the coming months. While inflation has been relatively low so far in 2025, experts predict that prices will gradually rise as the impact of tariffs becomes more significant.

Certain product categories, such as leather goods, apparel, and electronics, are expected to see the most significant price increases as a result of the new tariff regime. The Yale Budget Lab projects that prices could increase by 2% over the next two years due to the higher tariffs.

As the U.S. tariff policy becomes more entrenched in global supply chains, consumers can expect to see prices rise across various sectors. It’s important for businesses and consumers to be prepared for these changes and adjust their budgets accordingly.