Inflation erased U.S. income gains last year

Inflation is lower than it was at the beginning of the year. Which means inflation is actually going down this year.

Tariffs are just starting to work their way inoto consumer prices now.

We don’t have accurate data for most of 2025. The second half of 2024 was much better than the first half of 2024 which is really helping those year long moving averages, but the monthly inflation numbers have been increasing recently so it’s far to early to say what 2024 vs 2025 will actually look like.

Tariffs are deflationary, actually. They are a form of taxation and act to inhibit demand.

Anyways inflation is actually declining and is well below 2022 levels.

https://www.bls.gov/charts/consumer-price-index/consumer-pri...

Yes we do, price data is very reliable on a monthly basis:

https://www.bls.gov/charts/consumer-price-index/consumer-pri...

Employment figures are different and have had lots of problems in recent years.

You linked CPI for July which covers 7 out of 12 months. However, pricing data isn’t quite inflation data as that includes housing data which is sampled every 6 months.

Now if you’re happy comparing 12 month CPI averages ending in July then sure 2025’s July was 0.2% lower than 2024’s July. But I’m assuming you’re talking Jan-Dec 2024 which we have vs Jan-Dec 2025 which IMO is to early to call.

> They are a form of taxation and act to inhibit demand.

They also are a price increase. Whether that winds up being inflationary or deflationary depends on how much that price change impacts demand, which will likely vary from good to good.

Not only is 7 out of 12 months most of 2025, but a 12 or 13 month rolling average is generally fine to see trends and it's completely arbitrary as to whether you are observing July-June or Jan-Dec. Try looking at the economy from a Chinese or Hebrew calendar perspective. Does it really matter as long as you have a years worth of data including all seasons? No.

Tariffs go from the economy to the U.S. treasury, who ultimately issues the currency. That is, it's removing funds from private bank accounts to the US government balance sheet, reducing the deficit and the money supply at the same time.

Inflation is everywhere and always a monetary (or money supply) phenomenon.

Reposting my original claim:

Tariffs are deflationary, actually. They are a form of taxation and act to inhibit demand.

Inflation is actually declining and is well below 2022 levels.

https://www.bls.gov/charts/consumer-price-index/consumer-pri...

7 out of 12 for CPI is not 7 out of 12 for inflation. Also, 7 out of 12 may be a majority of X but it’s not “most of” X.

> Does it really matter as long as you have a years worth of data including all seasons?

Using the correct words for something makes a big difference for communication. After jumping through all these hoops we understand what we each mean at this point, but it definitely didn’t need to take this much back and forth.

OP here, I actually agree with you about inflation being different from tariffs (which are indeed taxation), but people do often just conceive of inflation as prices going up, which is why I chimed in about the timing of tariffs (which I probably have more insight about than others on this site, since the company I run is affected by tariffs and we’re just now starting to see competitors increase prices).

That being said, one hypothetical scenario is that tariffs shift demand to domestic manufacturing, causing the price of domestic manufacturing to increase due to supply and demand imbalance. This would result in prices going up without any tariffs being paid. Theoretically. I don’t think that will actually happen in the short term.

>Inflation is everywhere and always a monetary (or money supply) phenomenon.

It's also a prices going up phenomenon. I trump puts 100% tariffs on imports and Walmart marks prices up 100% then you have inflation. No monetary change there.

Your point is addressed in the comment you're responding to.