Despite widespread anticipation that the president’s universal 10% tariff on imports would soon trickle down into consumer prices, inflation continued to decelerate in May, with Consumer Price Index inflation down 20% since President Donald Trump took office. That has translated to a pay raise for workers. After falling more than 4% throughout former President Joe Biden’s administration, real average weekly wages are up 1.3% in the first five months of Trump’s second term.

It’s possible that businesses have a limited ability to eat the cost of tariffs and will eventually have to pass them on to consumers in the form of increased prices. Furthermore, rebound inflation would be nearly guaranteed if Trump reverts to his ill-advised menu of “reciprocal tariffs” after the July end date of the 90-day post-“Liberation Day” pause.