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Trump Tariffs Will Result in Higher Prices for Electronics, Fuel and Food, Experts Warn

Tariffs promised by President-elect Donald Trump would result in increased prices for U.S. consumers, experts warned in an analysis of current trade flows and tariff rates.

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Economists at the Peterson Institute for International Economics said that “machinery and electronics and electrical machinery will face the largest import tax burden if the incoming administration implements Trump’s promised duty hikes,” but that tariffs and retaliatory foreign tariffs would result in “higher costs for imported final goods, including electrical devices, toys and sporting goods, vegetable and meat products, and imported foodstuffs.”

The analysis is in response to Trump’s threats to impose new tariffs of up to 60% on imports from China (see 2411200051), 25% on Mexican and Canadian imports (see 2411250073), and a possible 10% tariff on all U.S. imports (see 2410160038).

The economists particularly scrutinized imported goods that currently face low tariff rates, such as toys and sporting equipment, minerals, and electronics and electrical machinery. These products were “largely shielded from [the previous] trade war tariffs,” and so tariff increases “almost certainly will be felt directly by American households.”

Transportation and fuel prices also will be hard hit as free trade agreement partners “supply more than half of America’s fuel and transport equipment imports,” the report said. With a 10% tariff increase on FTA partners, Americans can expect cars and fuels to cost more, particularly as, “within North America, production of cars and trucks is highly integrated, with some vehicles crossing US borders multiple times before completion.”

U.S. tariff increases on USMCA partners Mexico and Canada also would increase domestic prices at the grocery store as these countries are “important sources for the United States of vegetable products (47% of total imports), prepared foodstuffs (42% of total imports), and animal products (33% of total imports). Higher tariffs on Mexico and Canada will, therefore, put upward pressure on US food prices,” the report said.