By Emily Lambert. She is with The University of Chicago Booth Review.
"In a survey conducted in December and early January, many said they expected Trump to impose tariffs of up to 50 percent on US trade partners. About 40 percent said they are likely to stockpile goods, and about a third would set aside money in preparation for possible price hikes, report University of Texas’s Olivier Coibion, University of California at Berkeley’s Yuriy Gorodnichenko, and Chicago Booth’s Michael Weber."
"It’s generally accepted in economics that tariffs make both imports and domestically produced goods more expensive, and respondents tended to agree. On average, they expected prices on imported products to rise 10 percent in the next year and those on domestically produced goods to jump 14 percent."
"Coibion, Gorodnichenko, and Weber note that while the survey asked about expectations, it’s likely that consumers are already stockpiling goods and companies are already raising prices. “This suggests that the inflationary consequences of the tariffs will manifest themselves even before the tariffs are put in place, further complicating the Federal Reserve’s job of bringing inflation back down to its target,” they write."
This is one of the shift factors for demand. If buyers expect prices to rise in the near future demand today will increase. That makes the price increase right now which is what the last paragraph says.
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