Goldman Sachs: Canada, Mexico tariffs will increase US inflation by 0.6%
Goldman Sachs economists predict that Trump's imposition of a 25% tariff on imported goods from Canada and Mexico, and a 10% tariff on Canadian energy, will cause core consumer prices in the United States to rise by 0.6%. "We do not rule out the possibility of suspending the tariffs at the last minute," they wrote in a report to clients on Monday evening. "This time, an obvious strategy is to extend the deadline to April 2 to align with other planned tariff announcements. If the tariffs take effect, we believe they are unlikely to become a permanent feature of US trade policy, although it is uncertain how long they will last." The US core consumer price index, excluding food and energy, rose by 3.3% year-on-year in January, while the Fed's preferred PCE index rose by 2.6% year-on-year. (FXStreet)
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