Tracking the Short-Eun Effects of Tariffs on Consumer Price: Tariffs on imports can raise consumer prices, but the extent and timing of that impact vary. Costs can be absorbed by foreign exporters, domestic firms, or passed through to consumers at the retail level. During the 2018–19 trade war, our research showed that U.S. firms initially absorbed most of the tariff burden, resulting in delayed and limited price increases at the retail level. In our new study—Tracking the Short-Run Price Impact of U.S. Tariffs—we examine the effects of the 2025 tariff measures in real time using high-frequency pricing data and product-level detail.
This page presents the main graphs from the paper. The full paper is available here: Tracking the Short-Run Price Impact of U.S. Tariffs (Cavallo, Llamas, Vazquez, 2025).
Data and Methodology
To measure the impact of the 2025 tariffs, we construct daily price indices using online data from four major U.S. retailers. These prices are collected on a daily basis by PriceStats. We obtained detailed information on country of origin for each good—sourced through UPC lookups or generative AI models—as well as to tariff classifications using Harmonized System (HS) codes. We track the same products over time using a matched-model approach and compute unweighted geometric averages of daily price relatives within each group. The resulting indices provide high-frequency, real-time insights into how tariffs affect consumer prices by country, category, and exposure—without seasonal or quality-based adjustments.
Imported and Domestic
This figure plots daily unweighted price indices for goods sold by four major U.S. retailers, classified as either domestic or imported. The indices are constructed using a matched-model approach, where product-level price relatives are chained over time. Only products with identified country of origin are included. Each index is normalized to one at the initial observation date.
By Country of Origin
This figure displays separate daily price indices for products identified as originating from China, Mexico, Canada, and the U.S. Products are grouped based on country-of-origin information obtained through UPC-based matching or generative AI prediction. Indices are constructed as unweighted geometric means of price relatives and updated using the same matched-model chaining method.
Domestic Goods in Affected and Unaffected Categories
This figure shows daily price indices for three product groups: imported goods, domestic goods in tariff-affected categories, and domestic goods in unaffected categories. Affected domestic categories include either (1) HS codes subject to tariff changes or (2) COICOP categories with more than 50% of items classified as imported. The indices are unweighted and constructed using the matched-model method described earlier.