Originally published at: This week in charts: US inflation rises again – InvestEngine Insights
As the markets continue to digest the results of earnings season, mentions of tariffs on S&P 500 company earnings calls have spiked significantly. The increased prominence stems from Trump’s continued use of tariffs as a negotiating tool, notably with Canada and Mexico, but more recently in retaliation against other countries imposing taxes on US imports. The S&P 500 rose over 1% on Thursday as it was announced the implementation of Trump’s reciprocal tariffs had been delayed:
In stark contrast, the frequency of “diversity” mentions has dropped sharply:
The politics of inflation
Elsewhere in the intersection of politics and markets, inflation expectations have diverged significantly between democrats and republicans since the election in November. According to the University of Michigan survey, democrats now anticipate inflation reaching over 5% in the next year (up from under 2% before Trump was elected), while Republicans expect it to be near zero (down from a peak of almost 8% under Biden):
The current reality is almost exactly between the two. Wednesday saw inflation in the US come in at 3.0%, with core inflation at 3.3%. Both remain stubbornly above the Fed’s 2% target, sending bond yields higher (on the expectation of rates staying higher for longer), and markets lower, with the market now pricing in only one US rate cut to come in late this year:
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