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Investing.com-- U.S. President Donald Trump claimed on Tuesday that the country was raking in a large amount of revenue from his trade tariffs, and that inflation- particularly in prices of essentials- was down.
“The United States is taking in RECORD NUMBERS in Tariffs, with the cost of almost all products going down, including gasoline, groceries... Likewise, INFLATION is down,” Trump said in a social media post.
It was not immediately clear whether Trump was referring to federal revenues from his tariffs, which are expected to be borne by U.S. importers, or a different metric.
Trump kickstarted a bitter trade war with China earlier this month, raising tariffs against the country to a cumulative 145%. China retaliated with a 125% duty on U.S. goods.
But Trump did soften some of his Chinese tariffs, especially those on electronics, due to the perceived economic impact of a 145% duty on all Chinese imports.
Trump had last week also announced a 90-day exemption for all countries apart from China that were targeted by his reciprocal tariffs.
Still, the U.S. president signaled that he planned to announce separate tariffs on electronics imports, and will also impose levies on pharmaceuticals. Trump’s administration had initiated a probe into electronics imports earlier this week.
Trump’s tariffs are expected to be largely borne by U.S. importers, who are in turn expected to pass them on to consumers. Analysts warned that this trend could ramp up U.S. inflation, disrupt supply chains, and dent economic growth.
Trump has in the past largely touted the potential fiscal revenue from his tariffs, which he claims will help the U.S. fix its fiscal deficit. Trump’s tariffs are also aimed at fixing alleged trade imbalances with major U.S. trading partners.
Data released last week showed that U.S. consumer price index inflation eased more than expected in March, although it was yet to reflect the impact of Trump’s tariffs on prices.
Core inflation still remained relatively sticky.