Parsing the data for hints of US tariff impacts

Tariffs are now live and being collected. But what does data say about their initial impacts on the economy…and who’s footing the bill?

article-image

GreenOak/Shutterstock and Adobe modified by Blockworks

share

This is a segment from the Forward Guidance newsletter. To read full editions, subscribe.


We’re entering the phase where we can see the impact of tariffs on the economy and gauge how companies are responding to these price increases.

We’d forgive you for not knowing what the current tariff rates are, considering they change quite frequently. As for the China 90-day pause agreement, the aggregated effective tariff rate is somewhere around 12.6%:

We’re now also seeing tariff revenue actively being collected:

We’re now well within the phase where corporations must decide to either absorb cost increases or pass them onto consumers. The result of this calculus will set the stage for how the economy navigates the next 12 months and who bears the brunt of it. 

Some of the economic data released today hints at the answer:

PPI

We saw a huge downside miss in PPI today. When you dig into the data, it becomes apparent that the miss was largely caused by a big decrease in portfolio management fees. 

This was due to the market crash in April:

This downtick masked interesting insights into how much price increases are being passed to consumers vs. being absorbed by corporations. 

Economist Parker Ross outlined how most of the increases are being absorbed by corporations, for now:

“So far, it looks like the impact of tariffs is generally not being meaningfully passed on to consumers, but they do appear to be getting passed on to businesses.”

“We see this in the limited acceleration in PPI for core finished consumer goods contrasted against the sharp acceleration in PPI for private capital equipment to 0.61%, the strongest monthly gain outside of the pandemic since 2008.”

Retail sales

We also received the retail sales print today, which illuminates how consumption habits are shifting based on the tariff implementation. 

Categories not impacted by tariffs (like food services) surged. On the other hand, categories heavily impacted by tariffs, such as big box retailers and sporting goods — where a lot of frontrunning occurred before the tariffs went live — are now cratering:

This dynamic is a small example of what is likely to happen as the economy digests tariffs: frontrunning before the tariffs, then a singular price level increase, then demand destruction as higher prices lead to decreased demand. 

As we navigate the next few months, the economic data will be extremely noisy. 

As we can see from these two prints, it’s essential to dig beneath the topline numbers to better understand what’s driving the numbers.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research

article-image

Attorneys weigh in on the issue in light of a changing US regulatory environment

article-image

A new report by top Ethereum stakeholders projects ETH at $8000

article-image

Onboarding the world to Bitcoin takes a series of firsts

article-image

If we get an altcoin season, it’ll be focused on tokens deemed “ fundamentally valuable enough for traditional public money and capital” to get involved with

article-image

Solana dropped nearly 10% amid mass crypto liquidations triggered by rising geopolitical strife

article-image

Investors moved to safe assets like the US dollar and gold, but bonds faltered