INDIANA --- There's a possibility that newly implemented tariffs could boost inflation here in the United States. WRTV talked to a local economist about how this could impact Hoosiers who have seen higher prices since before the pandemic.
"It's a lot harder,” said Sherry Fox. The Indy resident is afraid of what more changes could mean.
“Keeping up with being able to make ends meet, paying your bills and being able to buy groceries, it could get a lot harder," Fox said.
Her concerns come after President Trump announced plans for several proposed tariffs on steel, lumber, computer chips and more.
“All goods are potentially subject to tariffs that are produced outside of the United States, and that's quite a bit,” explained Kyle Anderson, an economist with the IU Kelley School of Business.
The latest tariff on auto imports was announced this week.
“I just got to deal with it and pray it doesn’t get worse,” said Kenneth Craig. He just bought a new car a month ago and is a little worried about the repair cost.
Anderson told WRTV that changes could mean higher inflation on the horizon.
“I expect a lot of items will go up significantly in relatively short order,” Anderson said. “You will see new car prices go up significantly. We'll see used car prices likely go up as well. You think about things like fruits and vegetables, those items are going to get more expensive.”
Anderson added that inflation started to steady after it rose significantly during the pandemic. However, looming tariffs could have a major economic impact.
“I think there's significant risks that this is going to do some economic harm," Anderson said. "When prices are higher, and if people buy less, that overall can send the economy into a recession.”
WRTV asked Anderson what advice he’d offer to consumers right now. Here’s what he suggested:
“Maybe tighten the belt a little bit, keep a little extra cash on hand,” Anderson said.”Don’t leave your job unless you have something else lined up. These are standard practices but especially good advice in this economic environment."
Anderson told WRTV it’s hard to tell exactly when inflation could ease again because of the uncertainty surrounding tariffs.
The outlook on inflation and the uncertainty with the new tariffs are cited as reasons the stock market plummeted Friday.
