Goldman Sachs: Tariffs could push up U.S. inflation

Odaily Planet Daily News Goldman Sachs economists wrote that tariffs are likely to push up U.S. commodity prices and overall inflation in the coming months. They expect tariffs to have a mild impact on the May CPI data released on Wednesday. Rising commodity prices may increase core inflation by 0.05 percentage points, raising the overall core CPI inflation rate by 0.25% month-on-month. But Goldman Sachs predicts that core CPI inflation may reach 3.5% by the end of this year, higher than 2.8% in April. Goldman Sachs expects this increase to occur despite reduced inflationary pressures in the labor market, housing rental and automobile industries. Goldman Sachs expects hotel prices and airfares to remain flat in May, reflecting a slowdown in the consumer economy. "Our forecast reflects that inflation in most core commodity categories will accelerate significantly, but the impact on core service inflation will be limited, at least in the short term." (Jinshi)