Bad news for US shoppers: The cost of everything from laptops to cars is likely to keep rising

American consumers are beginning to feel the pinch from the US’s latest wave of import tariffs, and the pain is expected to get worse.

Since returning to office, President Donald Trump has imposed a blanket 10% baseline tariff on all foreign imports, additional varying rates on specific countries, and a series of product-specific duties, including on automobiles.

So far, consumers have absorbed just 22% of the tariff costs associated with this year’s increases, according to a new Goldman Sachs report published Sunday. But by October, that share could rise to 67%, if pricing patterns continue to follow those observed earlier in the year.

Goldman reached that conclusion by analyzing import and consumer price data through June.

“Descriptive evidence shows that goods categories heavily exposed to imports have indeed experienced sizable price increases since the beginning of this year, relative to their prior trends,” they wrote.

Specifically, prices of household appliances and information processing equipment — such as computers and electronics — have increased by 7.5 percentage points more than what they would’ve cost without the tariffs, they wrote.

What’s especially striking is who’s been absorbing tariff costs so far. US businesses have born the brunt, covering about 64% of costs through midyear, Goldman found.

Meanwhile, foreign exporters have cut prices to stay competitive, absorbing around 14%.

But that’s expected to change.

According to Goldman, tariffs have already contributed about 0.20 percentage points to core Personal Consumption Expenditures inflation — the Federal Reserve’s preferred inflation measure. They expect an additional 0.16% increase in July, and another 0.5% from August through December.

Some major companies, including Adidas and Walmart, have said that they will be hiking prices in the US.

That means consumers may face higher prices on everything from electronics to cars heading into the holiday shopping season.

Goldman expects core PCE inflation at 3.2% year over year by December — well above the Fed’s 2% target. Without tariffs, Goldman says, the underlying inflation trend would be closer to 2.4%.

Treasury data shows that the federal government has collected over $100 billion from customs duties so far this year — a sign that “someone is paying” for the tariffs, wrote Deutsche Bank last month.

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