Many of us have been following the inflation data closely for evidence of Trump’s tariffs. Along with most other economists I have been somewhat surprised that we haven’t seen more evidence to date.

One thing we can say based on the evidence, is that exporters are not eating the tariffs, as Trump promised. The data on import prices, which do not include the tariffs paid on goods, shows non-fuel import prices rose in both April and May.

The index for non-fuel import prices for May was up 1.7 percent from its year ago level. By comparison, in May of 2024 the year-over-year increase was just 0.5 percent. We will have to wait to see the extent to which the tariffs end up leading to lower profits for importers and retailers, as opposed to higher prices for consumers, but it’s clear that the exporters are not paying them.

Just as we are waiting for more evidence on where the tariffs are hitting, we are also waiting for clearer evidence of the impact of Trump’s mass deportation policy. While the pace of arrests and deportations has picked up sharply in the last month, the bigger effect is likely the fear that this process has created among immigrants, including many who are here legally or are even U.S. citizens.

With ICE officials saying that they are not subject to standard legal procedures, in terms of obtaining warrants, identifying detainees, and allowing access to lawyers and family members, millions of non-white people are scared to go out in public. This is especially true in places where the crackdowns have been most intense, like Los Angeles, but........

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