The Wall Street Journal editorial board smacked President Donald Trump yet again on Thursday, amid news of new inflation woes driven by the president's tariffs.
"Consumer prices climbed 0.4% in August and 2.9% over the past year, both the most since January. Price increases last month were broad-based, hitting food consumed at home (0.6%), alcohol (0.6%), children’s shoes (1.5%), clothing (0.5%), new cars (0.3%), used cars (1.0%), housing (0.4%), hotels (2.6%), vehicle repair (5.0%), air fares (5.9%) and more," wrote the board, which, despite its conservative leaning, have grown fed up with Trump's tariff policies. "The index for so-called core prices (less volatile food and energy) wasn’t more reassuring. Those prices rose 0.3% in the month, or 3.1% over the last 12 months."
The tariffs beginning to kick in are the clear culprit, the board argued.
"Businesses report that they’ve run through inventory they stockpiled before Mr. Trump’s tariff barrage and are starting to pass on their higher costs to customers," they wrote. "Auto-repair shops are getting whacked by Mr. Trump’s 25% tariff on parts and 50% on steel and aluminum. The tariffs could also have indirect effects. Used cars prices are increasing because the supply has shrunk as people hold onto their jalopies longer because they can’t afford new cars."
This is coming at the same time as a market slowdown with rising layoffs, which — the board wrote — complicates the Fed's path to implementing the monetary policy that Trump and his allies have spent months browbeating them to do.
"A 25 basis-point cut is probably in the bag after last week’s labor report showed a summer stall in job creation. But the Fed has to worry about persistent inflation above its 2% target," the board concluded. "Easier money may help Wall Street, but it won’t counter the economic policy mistakes that are to blame for Main Street’s malaise."