Tariffs play large role in this year’s price increases, corporate finance leaders claim

Tariffs are playing a large role in this year’s price increases, a poll of corporate finance leaders released Wednesday shows. The CFO Survey, conducted by Duke University with the Richmond and Atlanta Federal Reserve Banks, reports that executives say tariffs account for about one-third of their firms’ price gains this year.

With the latest inflation rate at 2.9%, cutting it by a third would put it near 2%, the Federal Reserve’s preferred pace. The results also run counter to Trump’s repeated claim there is “no inflation” and that his trade approach is not pushing prices higher.

CFOs also push back on the idea that tariffs create only a brief, one-time reset. They anticipate tariffs will explain about a quarter of next year’s price increases as well.

“This isn’t a one-time thing. It is still going to be happening in 2026.”

The main channel is higher import bills

As reported by CNN, many companies indicate they will pass part of those costs to customers. Among the brands that have signaled price hikes on certain items due to tariffs are Walmart, Target, Hasbro, Nike, Mattel, Stanley Black & Decker, and Procter & Gamble. On average, firms see prices up 3.9% this year, with tariffs contributing about 1.3 percentage points.

At a press conference last week, Federal Reserve Chair Jerome Powell said the tariff “pass-through” to consumer prices has been “slower and smaller than we thought,” while cautioning it likely is not finished.

Powell also pointed out that goods prices generally drifted lower over the past 25 years outside the Covid-19 period, a pattern that has flipped since Trump took office, likely because of tariffs.

Tariff-sensitive goods see sharpest price jumps

Several tariff-sensitive categories are seeing faster increases. Jewelry and auto repair costs have picked up. Coffee stands out. The United States imports most of its beans from Brazil, which now faces 50% tariffs. Between July and August, coffee prices rose 4%, the largest one-month jump in 14 years, and were nearly 21% higher than a year earlier, the biggest annual increase since 1997, the Bureau of Labor Statistics said.

Tomatoes show a similar move. Prices climbed 4% in August, the most since the pandemic, after most imports from Mexico were hit with 17% tariffs this summer.

Not every policymaker views the risk as severe. Stephen Miran, newly appointed to the Fed and a former White House economist, said Monday that fears around tariff-linked price increases are excessive. “With respect to tariffs, relatively small changes in some goods prices have led to what I view as unreasonable levels of concern,” he said at the Economic Club of New York.

Another debate is who ultimately pays

Miran said he expects “exporting nations will have to lower their selling prices” to shoulder the tariffs. If that were happening broadly, import prices would be falling. Instead, the BLS reported a 0.3% rise in August import prices, with nonfuel imports posting their biggest increase since April 2024. Powell put it plainly last week. “The tariffs are not, mostly not, being paid by exporters.”

Despite these pressures, finance chiefs say the business outlook has improved from April through June as some uncertainty eased. They also report a small step down in expected cost and price increases this year. The survey’s authors say that could mean the “extreme impacts” many feared have not yet arrived, or that some firms now think more of the increases will show up in 2026 rather than 2025.

Even so, tariffs and trade policy remain the top concern for CFOs for a third straight quarter. Those listing tariffs as a leading worry are “notably more downbeat” about the economy and their own companies, the survey says.

Another CFO said, “We buy products from Canada, Mexico, and of course, China. Our main issue is that we can only set prices once a year, but our product costs are all over the place.”

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