Brown University Professor Şebnem Kalemli-Özcan critiques the planned tariffs by the Trump administration on imports from Mexico, Canada, and China, arguing they will harm the U.S. economy by raising consumer prices and potentially leading to recession. She emphasizes that while tariffs are intended to protect domestic industries, they could result in decreased consumer spending and increased unemployment.

Shoppers are anticipating a more expensive holiday season in 2025, with 40% expecting fewer discounts and 75% predicting higher spending due to inflation and tariffs. Many consumers plan to start their shopping earlier to find better deals, while concerns about inventory shortages from independent retailers add to the challenges. Extended return policies are expected to influence purchasing decisions as economic pressures loom.

The article discusses the challenges consumers face with rising prices due to tariffs and inflation, highlighting how these economic factors impact innovation and purchasing behavior. It emphasizes the need for businesses to adapt their strategies to meet changing consumer demands in a volatile market.

Consumer pessimism decreased in May as the Consumer Confidence Index rose to 98, driven by a reduction in U.S.-China tariff tensions. Despite the optimism, concerns about inflation due to ongoing tariffs remain prevalent, while expectations for economic growth are still cautious.