Walmart is warning it plans to raise prices due to tariffs, despite the fact April’s Consumer Price Index (CPI) showing President Donald Trump’s tariffs did not affect consumer prices.
Walmart CEO Doug McMillon issued the update during an earnings call on Thursday, stating that they will try to keep prices “low as possible,” but the reality is, they are unable to absorb all of the costs due to tariffs.
“But given the magnitude of the tariffs, even at the reduced levels announced this week, we aren’t able to absorb all the pressure given the reality of narrow retail margins,” McMillon stated, adding, “The higher tariffs will result in higher prices.”
According to reports, consumers can expect to see the higher prices this month.
This announcement follows a positive economic report, as April’s Consumer Price Index (CPI) showed no evidence that Trump’s tariffs were yet resulting in higher overall inflation.
As Breitbart News’s Economics Editor John Carney reported, “Headline inflation came in at just 0.2 percent for the month. Core inflation—excluding food and energy—also ticked up just 0.2 percent. Year-over-year, the all-items index slowed to 2.3 percent, the lowest reading since February 2021.”
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Additionally, the April CPI report found that apparel prices fell by 0.2 percent, TV prices declined 2.1 percent, smartphone prices dropped 0.6 percent, while tools, hardware, and outdoor equipment prices rose by only 0.1 percent.
Further:
There were also increases in computer and appliance prices. Tariffs may have played a role in raising these prices—although it is possible that tariff frontrunning pushed up demand. Retail sales in March, the most recent month for which we have data, rose 1.8 percent at electronics and appliance stores. And even if tariffs did raise prices on these categories, this appears to have been offset by declines elsewhere.
McMillon’s dire outlook also follows the U.S. and China agreeing to suspend most of the tariff hikes, coming to a 90-day de-escalation while formal negotiations remain underway. Both countries agreed to move forward “in the spirit of mutual opening, continued communication, cooperation, and mutual respect.”
As Breitbart News reported:
Under the terms of the deal, the U.S. will reduce its reciprocal tariff on Chinese imports to 10 percent, down from the 125 percent level imposed during the height of the trade standoff earlier this year. China will match that move by lowering its own tariff on U.S. goods to 10 percent, also from 125 percent. Beijing also agreed to suspend non-tariff countermeasures that had been enacted since early April.
A separate 20 percent tariff the U.S. imposed over China’s role in supplying illicit drug manufacturers with key ingredients for fentanyl will remain in place.
The announcement also follows the U.S. striking its first formal trade deal with the United Kingdom.
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