A new white paper from S&P Global estimates that President Donald Trump\u2019s sweeping tariff policies will cost global businesses more than $1.2 trillion in 2025, with most of that cost ultimately falling on consumers. The report draws from input by 15,000 sell-side analysts covering 9,000 companies in S&P\u2019s research ecosystem.<\/p>\n\n\n\n
\u201cThe sources of this trillion-dollar squeeze are broad,\u201d said lead author Daniel Sandberg. \u201cTariffs act like taxes on supply chains, redirecting profits to governments while raising logistics and freight costs. The combined impact represents a massive transfer of wealth from corporations to consumers, governments, and infrastructure investors.\u201d<\/p>\n\n\n\n
While the Trump administration argues that tariffs primarily target foreign exporters, S&P\u2019s analysis paints a different picture. Only one-third of the burden falls on companies, with the remaining two-thirds hitting consumers through higher prices and reduced output.<\/p>\n\n\n\n
S&P analysts estimate $907 billion in direct impact to listed companies, with the rest affecting private firms, venture capital, and uncovered sectors. \u201cConsumers are paying more for less,\u201d noted co-author Drew Bowers, pointing to a fundamental shift in purchasing power.<\/p>\n\n\n\n
The report raises the stakes for both the White House and the Federal Reserve. While administration officials maintain that the tariffs are necessary to restore fair trade, Fed policymakers have so far treated them as a temporary inflationary shock.<\/p>\n\n\n\n
White House spokesman Kush Desai defended the tariffs, stating that the realignment of supply chains, including onshoring production, will ultimately benefit the American economy. \u201cAmericans may face a transition period, but the long-term burden falls on foreign exporters,\u201d he said.<\/p>\n\n\n\n
S&P forecasts a 64 basis point drop in corporate profit margins in 2025, easing to 28 in 2026 and 10 by 2028. The authors note that whether margins return to pre-tariff levels depends on firms\u2019 ability to adapt through tech, cost controls, and value chain shifts.<\/p>\n\n\n\n
The biggest disruption came in May with the removal of the \u201cde minimis\u201d exemption for imported goods under $800, which had shielded many low-priced products from tariffs. The change sent shockwaves through earnings reports and shipping data, marking a true inflection point for the tariff regime.<\/p>\n\n\n\n
\u201cIn the optimistic scenario, this is all just turbulence,\u201d said Sandberg. \u201cBut if permanent, it could reshape global trade and compress corporate profits for years.\u201d<\/p>\n\n\n\n
New S&P Global analysis shows consumers will bear most of the burden A new white paper from S&P Global estimates that President Donald Trump\u2019s sweeping tariff policies will cost global businesses more than $1.2 trillion in 2025, with most of that cost ultimately falling on consumers. The report draws from input by 15,000 sell-side analysts […]<\/p>\n","protected":false},"author":10772,"featured_media":13082,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[3060,3062,3059,3056,3061,3054,3058,3057,575,3055],"class_list":{"0":"post-13081","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-world","8":"tag-consumer-price-impact","9":"tag-de-minimis-rule","10":"tag-fed-monetary-policy","11":"tag-global-business-costs","12":"tag-profit-margin-contraction","13":"tag-sp-global-report","14":"tag-supply-chain-disruption","15":"tag-tariff-exemption","16":"tag-trump-tariffs","17":"tag-u-s-china-trade-tensions"},"_links":{"self":[{"href":"https:\/\/globalgazette.us\/index.php?rest_route=\/wp\/v2\/posts\/13081","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/globalgazette.us\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/globalgazette.us\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/globalgazette.us\/index.php?rest_route=\/wp\/v2\/users\/10772"}],"replies":[{"embeddable":true,"href":"https:\/\/globalgazette.us\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=13081"}],"version-history":[{"count":1,"href":"https:\/\/globalgazette.us\/index.php?rest_route=\/wp\/v2\/posts\/13081\/revisions"}],"predecessor-version":[{"id":13083,"href":"https:\/\/globalgazette.us\/index.php?rest_route=\/wp\/v2\/posts\/13081\/revisions\/13083"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/globalgazette.us\/index.php?rest_route=\/wp\/v2\/media\/13082"}],"wp:attachment":[{"href":"https:\/\/globalgazette.us\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=13081"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/globalgazette.us\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=13081"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/globalgazette.us\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=13081"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}