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Many retailers are stocking up on holiday-season merchandise now, in the midst of ongoing trade policy changes.Joe Raedle / Getty Images Share [Add NBC News to Google](https://www.google.com/preferences/source?q=nbcnews.com) Savewith a NBCUniversal Profile May 13, 2025, 9:08 PM UTC By [J.J. McCorvey](https://www.nbcnews.com/author/j-j-mccorvey-ncpn1299343) The trade war is far from over, and Americans could still pay a big price, according to economists and analysts.  Subscribe to read this story ad-free Get unlimited access to ad-free articles and exclusive content.  Even after the U.S. and China agreed to halt levies on each other for 90 days, U.S. households’ net purchasing power is still set to shrink by an average \$2,800 a year, [the Yale Budget Lab estimated](https://budgetlab.yale.edu/) Monday. The researchers’ current estimate is lower than [the \$4,900 hit](https://budgetlab.yale.edu/research/state-us-tariffs-april-15-2025) they forecast based on the state of play on April 15, but it still reflects the sting of a nearly 18% average effective tariff rate — the highest in more than 90 years. President Donald Trump has delayed, watered down or lowered many of his severest import taxes in recent weeks. He [partially walked back](https://www.nbcnews.com/business/economy/trump-tariffs-president-announces-90-day-pause-what-to-know-rcna200463) a slate of global duties days after unveiling it last month, [offered some reprieve](https://www.nbcnews.com/business/autos/trump-tariffs-auto-industry-gets-break-ford-gm-stellantis-uncertainty-rcna203464) on his 25% auto tariffs, and [temporarily slashed duties on China](https://www.nbcnews.com/world/asia/tariffs-china-trump-agree-slash-levies-duties-business-markets-bessent-rcna206193) to 30% after hiking them 145%. The administration [unveiled the outlines](https://www.nbcnews.com/politics/white-house/trump-says-major-trade-deal-will-discussed-white-house-event-thursday-rcna205509) of a trade pact with the United Kingdom last week and said it had held “productive” talks with Beijing officials over the weekend that are set to continue. But analysts and executives say the turmoil generated by Trump’s fast-changing trade policies has already begun hitting supply chains and [rewriting corporate strategies](https://www.nbcnews.com/business/business-news/trump-tariffs-company-earnings-predictions-changing-ford-mattel-rcna204962), including on pricing. Perhaps [the only major prediction](https://www.cnbc.com/2024/10/23/nobel-prize-winning-economists-donald-trump-agenda-endorse-harris.html) economists continue to voice confidently is that [consumers will see higher prices](https://www.nbcnews.com/business/consumer/tariffs-prices-which-products-are-more-expensive-now-rcna200419) from tariffs. Businesses are “sitting there making a very targeted choice, not probably based \[solely\] on their own economics but their economics and their competitors,” said Andy West, a senior partner at the consulting firm McKinsey who advises CEOs on corporate strategy and finance. “You’re going to have to react,” he said. 0 seconds of 15 minutes, 47 secondsVolume 90% Press shift question mark to access a list of keyboard shortcuts Keyboard Shortcuts EnabledDisabled Play/PauseSPACE Increase Volume↑ Decrease Volume↓ Seek Forward→ Seek Backward← Captions On/Offc Fullscreen/Exit Fullscreenf Mute/Unmutem Decrease Caption Size\- Increase Caption Size\+ or = Seek %0-9 Settings Off CC English Font Color White Font Opacity 100% Font Size 100% Font Family Arial Character Edge None Background Color Black Background Opacity 50% Window Color Black Window Opacity 0% Reset White Black Red Green Blue Yellow Magenta Cyan 100% 75% 50% 25% 200% 175% 150% 125% 100% 75% 50% Arial Courier Georgia Impact Lucida Console Tahoma Times New Roman Trebuchet MS Verdana None Raised Depressed Uniform Drop Shadow White Black Red Green Blue Yellow Magenta Cyan 100% 75% 50% 25% 0% White Black Red Green Blue Yellow Magenta Cyan 100% 75% 50% 25% 0% Auto270p (278 kbps) 1080p (4655 kbps) 720p (3456 kbps) 540p (1745 kbps) 360p (946 kbps) 270p (496 kbps) 270p (278 kbps) Live 00:00 15:47 15:47  - [Add NBC News to Google](https://www.google.com/preferences/source?q=nbcnews.com) [U.S. and China tariff reduction could ‘de-ice’ business between the two countries](https://www.nbcnews.com/meet-the-press/video/u-s-and-china-tariff-reduction-could-de-ice-business-between-the-two-countries-239408197624) 15:48 The CEO of Barbie maker [Mattel said last week](https://www.nbcnews.com/business/business-news/mattel-warns-price-hikes-trump-reiterates-kids-can-deal-fewer-dolls-rcna204979) that higher prices are on the table but expanding domestic manufacturing isn’t. “That’s OK, let him go, and we’ll put a 100% tariff on his toys, and he won’t sell one toy in the United States, and that’s their biggest market,” Trump responded in Oval Office remarks, during which he also [defended his reprieve](https://www.nbcnews.com/business/consumer/trump-helps-rolls-royce-threatens-higher-tariffs-mattel-toys-trade-war-rcna205660) on British luxury car brand Rolls-Royce. Big questions remain around how the global trade order will look a year from now, making it difficult to draw solid conclusions from recent data about the state of the economy or where it’s headed next. “There’s been a pretty substantial misalignment between the soft data — which intends to capture sentiment or confidence, or lack thereof — and essentially the hard data, which measures the activity in the economy," Mark Hamrick, senior economic analyst at Bankrate, told NBC News this month. He noted that the latest [employment data](https://www.nbcnews.com/business/economy/april-2025-jobs-report-who-is-hiring-firing-employment-rate-rcna203942) looked stronger than analysts had forecast, but many cautioned it was already a dated snapshot of the labor market. Even a [better-than-expected inflation report](https://www.nbcnews.com/business/economy/april-2025-inflation-report-cpi-what-to-know-us-economy-right-now-rcna206256) Tuesday failed to jolt investors, with major stock indexes little changed despite a cooldown in consumer prices. Seema Shah, chief strategist at Principal Asset Management, warned clients Tuesday of “prolonged inflation uncertainty,” saying in a note that “a clear read” on the direction prices are heading “won’t be visible for several months yet.” Analysts at Capital Economics all but waved away the April inflation numbers, saying that “it is likely to be a different story this month as tariff effects start to feed through” — echoing [warnings](https://www.nbcnews.com/business/economy/april-2025-jobs-report-who-is-hiring-firing-employment-rate-rcna203942) that [have greeted](https://www.nbcnews.com/business/economy/march-2025-inflation-report-economic-outlook-tariffs-what-to-know-rcna200518) economic data releases for weeks. For many industries, the trade war has already affected supply chains operating on monthslong lead times. Retailers are stocking up on holiday-season items now. Fireworks sellers recently told NBC News that [tariff plans had scrambled](https://www.nbcnews.com/business/economy/trumps-liberation-day-tariffs-are-threatening-independence-day-firewor-rcna203659) their last wave of shipments for July Fourth. Global trade data shows [manufacturing demand plunged](https://www.cnbc.com/2025/05/13/us-china-trade-war-pushed-supply-chain-to-breaking-point-data-shows.html) amid U.S.-China trade tensions in recent weeks, with experts warning the recent tariff truce isn’t likely to cool anxieties that have already [crashed into shipping volumes](https://www.cnbc.com/2025/04/22/busiest-us-ports-see-big-drop-in-chinese-freight-vessel-traffic.html).  Global trade data shows manufacturing demand has fallen amid U.S.-China trade tensions.Liz Dufour / The Enquirer / USA Today Network After [a big push to buy foreign products](https://www.nbcnews.com/business/economy/gdp-q1-us-economy-contracts-rcna203608) in the first quarter to get ahead of tariffs, many businesses and consumers are expected to trim their purchasing later this year. Small businesses’ outlooks [slid again in April](https://www.nfib.com/wp-content/uploads/2025/05/NFIB-SBET-Report-April-2025.pdf), the National Federation of Independent Business (NFIB) reported Tuesday, and many entrepreneurs have been [racing to blunt the expected impact](https://www.nbcnews.com/business/economy/tariff-hit-small-businesses-fear-getting-crushed-corporate-rivals-rcna199786). Decisions made weeks or months ago to pre-empt tariffs — including those that were subsequently revised or have yet to be implemented — frequently exact a cost to operations. “One day we’re having tariffs, the next day we’re not having tariffs, and the next day we’re having tariffs,” Victoria Park, a pet supply shop owner in Atlanta, [told NBC News](https://www.nbcnews.com/business/economy/tariff-hit-small-businesses-fear-getting-crushed-corporate-rivals-rcna199786) late last month. “That’s very, very hard for small businesses to navigate when you’re constantly changing things.” As consumers eye the economy [with growing pessimism](https://www.nbcnews.com/business/economy/consumer-confidence-lowest-level-12-years-recession-signs-what-to-know-rcna197996), many companies are bracing for sales to slow. The NFIB said April was “the fourth consecutive month real sales expectations declined after surging from recession levels after the election.” So far, the Trump administration hasn’t veered from its optimistic messaging even as officials rewrite the fine print of their economic agenda. The president has repeatedly rejected concerns about prices, despite [warning of short-term economic pain](https://www.nbcnews.com/politics/trump-administration/trump-rejects-concerns-prices-economic-uncertainty-defends-agenda-rcna203512) after campaigning on a vow to deliver immediate relief. Treasury Secretary Scott Bessent has argued that Trump is creating “strategic uncertainty” in his pursuit of trade deals. “The aperture of uncertainty will be narrowing and, as we start moving forward announcing deals, then there will be certainty,” he said in late April. The White House continues to describe tariffs as a multipurpose tool, from a means of juicing federal revenue — which early data shows has happened, [rising to a record \$16 billion in April](https://www.cnbc.com/2025/05/12/tariff-receipts-topped-16-billion-in-april-a-record-that-helped-cut-the-budget-deficit.html) — to restoring manufacturing, something experts in many [tariff-hit industries expect](https://www.nbcnews.com/business/economy/americas-last-alumina-refinery-trade-war-spells-trade-offs-rcna196539) to be a harder lift. Trump has indicated that any such difficulties are both worthwhile and surmountable. “The Golden Age of America will soon be upon us,” [he posted](https://x.com/TrumpDailyPosts/status/1921976561810669595) Monday on social media. Share [Add NBC News to Google](https://www.google.com/preferences/source?q=nbcnews.com) Savewith a NBCUniversal Profile [](https://www.nbcnews.com/author/j-j-mccorvey-ncpn1299343) [J.J. McCorvey](https://www.nbcnews.com/author/j-j-mccorvey-ncpn1299343) J.J. McCorvey is a business and economy reporter for NBC News. - [About](https://www.nbcnews.com/information/nbc-news-info/about-nbc-news-digital-n1232178) - [Contact](https://www.nbcnews.com/information/nbc-news-info/contact-us-n1232521) - [Help](https://nbcnews.zendesk.com/hc/en-us) - [Careers](https://www.nbcunicareers.com/) - [Ad Choices](https://www.nbcuniversalprivacy.com/privacy/cookies#accordionheader2) - [Privacy Policy](https://www.nbcuniversalprivacy.com/privacy?intake=NBC_News) - [Your Privacy Choices](https://www.nbcuniversal.com/privacy/notrtoo/?intake=NBC_News) - [CA Notice](https://www.nbcuniversalprivacy.com/privacy/california-consumer-privacy-act?intake=NBC_News) - [Terms of Service](https://www.nbcuniversal.com/terms) - [NBC News Subscription Terms of Service](https://www.nbcnews.com/subscribe/supplemental-terms) - [NBC News Sitemap](https://www.nbcnews.com/archive) - [Closed Captioning](https://www.nbcnews.com/information/nbc-news-info/closed-captioning-n1307063) - [Subscribe](https://www.nbcnews.com/subscribe) - [Advertise](https://together.nbcuni.com/advertise/?utm_source=nbc_news&utm_medium=referral&utm_campaign=property_ad_pages) - [NBC Select](https://www.nbcnews.com/select) © 2026 NBCUniversal Media, LLC

The trade war is far from over, and Americans could still pay a big price, according to economists and analysts. Even after the U.S. and China agreed to halt levies on each other for 90 days, U.S. households’ net purchasing power is still set to shrink by an average \$2,800 a year, [the Yale Budget Lab estimated](https://budgetlab.yale.edu/) Monday. The researchers’ current estimate is lower than [the \$4,900 hit](https://budgetlab.yale.edu/research/state-us-tariffs-april-15-2025) they forecast based on the state of play on April 15, but it still reflects the sting of a nearly 18% average effective tariff rate — the highest in more than 90 years. President Donald Trump has delayed, watered down or lowered many of his severest import taxes in recent weeks. He [partially walked back](https://www.nbcnews.com/business/economy/trump-tariffs-president-announces-90-day-pause-what-to-know-rcna200463) a slate of global duties days after unveiling it last month, [offered some reprieve](https://www.nbcnews.com/business/autos/trump-tariffs-auto-industry-gets-break-ford-gm-stellantis-uncertainty-rcna203464) on his 25% auto tariffs, and [temporarily slashed duties on China](https://www.nbcnews.com/world/asia/tariffs-china-trump-agree-slash-levies-duties-business-markets-bessent-rcna206193) to 30% after hiking them 145%. The administration [unveiled the outlines](https://www.nbcnews.com/politics/white-house/trump-says-major-trade-deal-will-discussed-white-house-event-thursday-rcna205509) of a trade pact with the United Kingdom last week and said it had held “productive” talks with Beijing officials over the weekend that are set to continue. But analysts and executives say the turmoil generated by Trump’s fast-changing trade policies has already begun hitting supply chains and [rewriting corporate strategies](https://www.nbcnews.com/business/business-news/trump-tariffs-company-earnings-predictions-changing-ford-mattel-rcna204962), including on pricing. Perhaps [the only major prediction](https://www.cnbc.com/2024/10/23/nobel-prize-winning-economists-donald-trump-agenda-endorse-harris.html) economists continue to voice confidently is that [consumers will see higher prices](https://www.nbcnews.com/business/consumer/tariffs-prices-which-products-are-more-expensive-now-rcna200419) from tariffs. Businesses are “sitting there making a very targeted choice, not probably based \[solely\] on their own economics but their economics and their competitors,” said Andy West, a senior partner at the consulting firm McKinsey who advises CEOs on corporate strategy and finance. “You’re going to have to react,” he said.  15:48 The CEO of Barbie maker [Mattel said last week](https://www.nbcnews.com/business/business-news/mattel-warns-price-hikes-trump-reiterates-kids-can-deal-fewer-dolls-rcna204979) that higher prices are on the table but expanding domestic manufacturing isn’t. “That’s OK, let him go, and we’ll put a 100% tariff on his toys, and he won’t sell one toy in the United States, and that’s their biggest market,” Trump responded in Oval Office remarks, during which he also [defended his reprieve](https://www.nbcnews.com/business/consumer/trump-helps-rolls-royce-threatens-higher-tariffs-mattel-toys-trade-war-rcna205660) on British luxury car brand Rolls-Royce. Big questions remain around how the global trade order will look a year from now, making it difficult to draw solid conclusions from recent data about the state of the economy or where it’s headed next. “There’s been a pretty substantial misalignment between the soft data — which intends to capture sentiment or confidence, or lack thereof — and essentially the hard data, which measures the activity in the economy," Mark Hamrick, senior economic analyst at Bankrate, told NBC News this month. He noted that the latest [employment data](https://www.nbcnews.com/business/economy/april-2025-jobs-report-who-is-hiring-firing-employment-rate-rcna203942) looked stronger than analysts had forecast, but many cautioned it was already a dated snapshot of the labor market. Even a [better-than-expected inflation report](https://www.nbcnews.com/business/economy/april-2025-inflation-report-cpi-what-to-know-us-economy-right-now-rcna206256) Tuesday failed to jolt investors, with major stock indexes little changed despite a cooldown in consumer prices. Seema Shah, chief strategist at Principal Asset Management, warned clients Tuesday of “prolonged inflation uncertainty,” saying in a note that “a clear read” on the direction prices are heading “won’t be visible for several months yet.” Analysts at Capital Economics all but waved away the April inflation numbers, saying that “it is likely to be a different story this month as tariff effects start to feed through” — echoing [warnings](https://www.nbcnews.com/business/economy/april-2025-jobs-report-who-is-hiring-firing-employment-rate-rcna203942) that [have greeted](https://www.nbcnews.com/business/economy/march-2025-inflation-report-economic-outlook-tariffs-what-to-know-rcna200518) economic data releases for weeks. For many industries, the trade war has already affected supply chains operating on monthslong lead times. Retailers are stocking up on holiday-season items now. Fireworks sellers recently told NBC News that [tariff plans had scrambled](https://www.nbcnews.com/business/economy/trumps-liberation-day-tariffs-are-threatening-independence-day-firewor-rcna203659) their last wave of shipments for July Fourth. Global trade data shows [manufacturing demand plunged](https://www.cnbc.com/2025/05/13/us-china-trade-war-pushed-supply-chain-to-breaking-point-data-shows.html) amid U.S.-China trade tensions in recent weeks, with experts warning the recent tariff truce isn’t likely to cool anxieties that have already [crashed into shipping volumes](https://www.cnbc.com/2025/04/22/busiest-us-ports-see-big-drop-in-chinese-freight-vessel-traffic.html).