The Producer Price Index, which shows the wholesale cost of goods, is set to be released Thursday with economists saying it will give better insight into how President Trump's tariffs are impacting the U.S. economy. Constance Hunter, chief economist at the Economist Intelligence Unit, joins CBS News to discuss.

Washington

Donald Trump has signed an order to impose tariffs imports into the U.S. from countries including China, Mexico and Canada.

Global Tariffs

President Trump's tariffs have led to some price increases in specific goods such as toys, home goods, and coffee, according to economists. However, the overall impact on the US economy remains limited for now, with broader effects expected to emerge over time.

Upcoming economic data, such as the Producer Price Index, is anticipated to offer more detailed information on how tariffs are affecting wholesale prices and company margins. Consumers are advised to consider alternatives or substitutes for products experiencing significant price hikes due to tariffs.

How are Trump's tariffs impacting the economy right now?

President Trump is saying the U.S. is taking in trillions of dollars from tariffs, but there are questions as to whether the higher duties are actually benefiting the economy. The Bureau of Labor Statistics is set to release the Producer Price Index tomorrow, and that report shows the wholesale cost of goods. Economists are saying that data will provide better insight into how the president's tariffs are impacting the U.S. economy and whether the Federal Reserve will cut interest rates come September. For more on this, let's bring in Constance Hunter. She is the chief economist at the Economist Intelligence Unit. And Constance, thanks for being with us. Let's just talk a little bit about how these tariffs, how much are they actually impacting the economy as a whole right now? Yeah, well, right now they're not impacting it as much as they are likely to impact it as the year progresses. So there are a couple of ways that we can measure this. We see this in terms of the actual receipts collected from the tariffs, and then we see it in terms of price data. Now, unfortunately, the producer price data only looks at prices paid domestically between companies, so it doesn't actually give us a ton of information about the tariffs per se. Some aspects of the producer price data, believe it or not, actually measure the margins that companies have. So in that respect, we'll have a little bit of information regarding whether companies are eating this or whether the tariffs just haven't fed through to them yet or whether they're passing it on to consumers. But in yesterday's data, we did continue to see signs that there are goods prices ticking up as a result of tariffs, and they're in areas where you would expect. It's in toys. It's in home goods. We didn't yet see it in apparel. We're continuing to see apparel prices stay pretty soft, but we expect to see it there. And someplace else we didn't see it just yet is in motor vehicles. And a big reason for that is that people brought forward motor vehicle purchases into the beginning of the year, and many of those tariffs have been given sort of reprieve for a little while, but we know that they're coming down the pike. Well, given all of this, do you have any practical advice then or tips for everyday consumers looking to navigate all the ups and downs we're seeing right now? Yeah. I mean, it's difficult, especially if it's for something that you buy often. So let's say you're buying olive oil and that's imported from another country. You know, you're going to see that increase in price. Coffee, we're looking at probably a 25% price increase for coffee. So either switch to other products if you can, whether that's tea or maybe drinking a few less cups of coffee, fewer cups of coffee a day, and then looking for substitute products that are either made in the U.S. or from countries that are not tariffed as highly. Constance, I love all your tips, but do not come for my coffee. I need my espresso in the morning and my cappuccino. I'm thinking I'm going to try to switch to tea, but I don't know. Sure. Constance, I'll do it. I'm going to get a lot more expensive for that. Thank you very much.

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How are Trump's tariffs impacting the economy right now?

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Global Tariffs