Trump: "Someone Needs to Show the CEA Report to Powell"
U.S. CEA Publishes Report on Tariff and Import Price Impact This Year
Report States "Overall Import Prices Have Fallen This Year"
Steven Miran, Chairman of the White House Council of Economic Advisers (CEA) and known as President Donald Trump's "economic strategist," compared the likelihood that the tariff policies of a second Trump administration would trigger inflation to "the odds of a meteor striking Earth."
In an interview with U.S. business news outlet CNBC on July 8 (local time), Chairman Miran addressed the possibility of tariffs leading to higher prices, stating, "Just as pandemics or meteor strikes can happen, though they are very rare, such things do occur," adding, "However, there is no clear evidence so far that tariffs have actually caused inflation."
When asked whether inflation caused by tariffs is an extremely rare event, Miran responded, "It's not that I'm trying to dismiss it," but emphasized, "What I want to say is that predictions are always difficult." He also remarked, "I don't have a crystal ball to foresee the future, and neither does anyone else."
The interview took place as the CEA, led by Miran, released a new report analyzing the impact of tariffs on imported goods. The CEA report noted that, despite concerns over tariffs, imported goods prices have actually declined this year. The CEA stated in the report, "Imported goods prices have generally fallen this year, and since February, they have declined at a faster rate than overall goods prices," highlighting that "this result runs counter to claims that tariffs or tariff concerns would accelerate inflation."
U.S. Personal Consumption Expenditures (PCE) Goods Prices and Imported Goods Prices (excluding service prices). Overall goods prices rose from 100 in December 2024 to 100.4, while imported goods prices fell from 100 to 99.9. Data from CEA report
The CEA based its analysis on changes in the Personal Consumption Expenditures (PCE) price index and the Consumer Price Index (CPI) from December 2024 to May 2025. The CEA divided its analysis between domestic and imported products. According to the report, during this period, overall PCE goods prices (excluding services) rose by 0.4%, while imported goods prices within the PCE fell by 0.1%. However, when both goods and service prices are included, total PCE increased by 1.1%, and imported goods prices rose by 0.2%. The CEA interpreted this by stating, "This may be because service prices have pushed up the overall figures," and "excluding them, imported goods prices are on a downward trend." However, as the CEA clearly stated in the report, this analysis has structural limitations, such as: the PCE index does not distinguish whether price changes are due to domestic or imported products, and the fixed share of imports means the analysis does not account for the 'substitution effect' that occurs when consumers change their behavior.
President Trump also cited the CEA report on his own social networking service, Truth Social, and expressed even more strongly that the impact of tariffs on prices is "zero (0)." He said, "This study shows, as I have always said, that import prices are indeed falling," and asserted, "Fake news and so-called experts are wrong again."
President Trump also targeted Jerome Powell, Chair of the U.S. Federal Reserve (Fed), saying, "Someone needs to show this research to 'Too Late' Chairman Powell," and criticized, "He has spent months whining like a baby about imaginary inflation and has refused to do the right thing." He reiterated his call to "lower interest rates," stating, "Now is the right time."
There are also counterarguments regarding the CEA's analysis. CNBC cited three reasons why inflation has not yet become apparent: President Trump's postponement of tariff implementation through a grace period, the lag between tariffs and their effect on real economy prices, and companies stockpiling goods before tariffs take effect. Previously, on April 2, President Trump announced a reciprocal tariff policy and granted a 90-day grace period. The deadline was extended twice to allow countries to sign bilateral trade agreements with the United States, and is currently set for August 1.
Concerns have continued that U.S. tariffs could drive up prices not only domestically but also globally. For similar reasons, the U.S. Fed has maintained interest rates despite President Trump's pressure to cut them. After remaining silent in the face of Trump's pressure, Chairman Powell stated for the first time on July 1, "We delayed a rate cut due to concerns about inflationary pressures from tariffs."
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