{"id":315629,"date":"2025-08-03T22:24:12","date_gmt":"2025-08-03T22:24:12","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/315629\/"},"modified":"2025-08-03T22:24:12","modified_gmt":"2025-08-03T22:24:12","slug":"morgan-stanley-on-us-inflation-tariffs-to-hit-initially-in-3-5-monthsfurther-in-8-months","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/315629\/","title":{"rendered":"Morgan Stanley on US inflation, tariffs to hit initially in 3-5 months,further in 8 months"},"content":{"rendered":"<p data-v-64ab016d=\"\">Snippet from Morgan Stanley on the expected impact of Trump&#8217;s tariffs in the months ahead, in brief. Bolding is mine:<\/p>\n<ul data-v-64ab016d=\"\">\n<li data-v-64ab016d=\"\">U.S. import data in May showed that the effective tariff rate was at 8.3%, much lower than Morgan Stanley\u2019s baseline estimate of a rate in the low- to mid-teens, but there should be a convergence to the forecast in June and July.<\/li>\n<\/ul>\n<ul data-v-64ab016d=\"\">\n<li data-v-64ab016d=\"\">Shipping delays, higher-than-expected USMCA imports from Mexico and Canada, and a sharp drop in purchases from China are among the reasons for the lower-than-expected rate. <\/li>\n<\/ul>\n<ul data-v-64ab016d=\"\">\n<li data-v-64ab016d=\"\">As data for June and July are likely to show a higher effective tariff rate, the pass through to U.S. inflation should be more apparent. <strong data-v-64ab016d=\"\">Historically, the real impact on consumer prices appears three to five months after the tariff implementation, and the knock-on to growth comes one quarter later.<\/strong><\/li>\n<\/ul>\n<ul data-v-64ab016d=\"\">\n<li data-v-64ab016d=\"\"><strong data-v-64ab016d=\"\">\u201cWe\u202fexpect tariffs could add up to 1 percentage point in prices in the coming months before subsiding as demand softens in reaction\u201d<\/strong><\/li>\n<\/ul>\n<p data-v-64ab016d=\"\">&#8212;<\/p>\n<p data-v-64ab016d=\"\">The generally accepted impact of tariffs are they are a &#8216;one-off&#8217; addition to inflation and then inflation subsides back to its previous path. Which seems reasonable. Do note, though, that this is subject to debate amongst the folks that matter &#8230;. Federal Reserve officials. Dallas Fed President Logan provided a quck view thorugh the window into the debate in comments a couple of weeks back:<\/p>\n<p data-v-64ab016d=\"\">Over the weekend we heard from NY Fed head Willaims:<\/p>\n<p data-v-64ab016d=\"\">In a nutshell Williams said that if the data indicate a rate cut is appropriate he&#8217;d be sopen to doing so. I klnow some folks are hanging a lot onto this reasoning from Williams but I would humbly point out that &#8216;data dependence&#8217; from Fed officials (and other central bankers) is not new news. What the **** else would Williams say??? <\/p>\n","protected":false},"excerpt":{"rendered":"Snippet from Morgan Stanley on the expected impact of Trump&#8217;s tariffs in the months ahead, in brief. Bolding&hellip;\n","protected":false},"author":2,"featured_media":315630,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3090],"tags":[51,1700,114951,16,15],"class_list":{"0":"post-315629","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-morgan-stanley-inflation-tariffs","11":"tag-uk","12":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114967180977564845","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/315629","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=315629"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/315629\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/315630"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=315629"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=315629"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=315629"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}