According to new research published by the Budget Lab at Yale University, President Donald Trump's tariffs will raise prices by almost 2% in the short run, costing the typical middle-class household more than $2,200 per year.
That estimate is down from the group's mid-April estimate of around $3,400 a year.
The updated estimates come after the Trump administration announced it would lower tariffs on goods imported from China from 145% to 30% for 90 days. The estimates also reflect a new trade deal the United States reached with the United Kingdom, which will most heavily impact the import of British automobiles and parts.
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The Budget Lab states that consumers face an overall average effective tariff rate of 17.8%, marking the highest level since 1934.
The report indicates that President Trump's tariffs disproportionately affect textile imports. In the near term, consumers are facing 15% higher prices for shoes and 14% higher prices for apparel, the report says.
As more tariffed goods reach the U.S., those rates are expected to climb, the report adds.
The report also suggests that tariffs could cause the U.S. unemployment rate to increase by 0.4 percentage points by the end of 2025.
In addition to tariffs on Chinese goods, there are currently universal 10% tariffs on most imported items, with a 25% duty on steel and aluminum products. Tariffs are charged to the company importing the product, and many companies have stated that those costs are passed on to consumers. President Trump has put a 90-day pause on higher tariffs on dozens of nations to facilitate negotiations.
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President Trump has indicated that he intends for the tariffs to reignite manufacturing in the U.S.
