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Liberation Day, which occurred last month, and its economic effects are the question on everyone’s mind. In this month’s newsletter we review what the experts say about the major ways the tariffs are likely to have an impact.
Here are the key points.
- While it seems like the current market has assumed the worst when it comes to the tariffs, it’s likely that the Trump administration will roll them back once trade relations become normalized. Try to keep a long-term view, stick to your overall plan, and don’t allow the headlines or short-term volatility to dictate how you invest.
- It’s hard to say what the impact of the tariffs on inflation will be. There is no way to truly gauge, but experts project the rate of inflation in the long term is likely to approximate the run rate of 2%.
- Tariffs do not appear to have had any effect on earnings, as growth has held steady. This is a positive sign for the equity market.
- There’s no clear signal about the impact the tariffs are likely to have on consumers. The consumers’ purchasing habits and location are the most likely determinant of how they’ll be affected. Just as a rising tide lifts all ships, a decline in oil prices would offer top-line support to consumer spending.
Tariffs may come and go, but like all forms of political uncertainty they generally do not sway the market in the long term. The greatest determinant of your financial success is your ability to create a financial plan that you can stick to, and to arrange your portfolio in alignment with what it calls for. If you’d like to revisit your wealth plan or have any tariff questions, please send us a note.
-Judd
Sources
Blancato, Philip. (2025, April). Osaic, Inc. Liberation Day Aftershocks.